Day by day more people are using the electronic form of money more than the cash or coins. As a result, the financial system is shifting more from cash transactions to electronic transactions. This change in the transaction system has put many people into a dilemma about the future of money and its impact on society.
Many financial experts say the future of money will take a new direction. The use of electronic transactions has increased significantly, resulting in a substantial decrease in cash transactions. However, paper money won’t go away very soon. It’s pretty uncertain how the future of money is going to be, but here are some predictions you ‘d like to know.
Most of the developed nations are moving towards a cashless society. Some countries in the UK are now using less than 30% of cash payments and it will reduce more in the next year. South Korea is planning for a completely cashless society by the end of 2020. Many financial experts say that it is happening at an unexpected faster rate.
In fact, nobody knows when the whole world will become a cashless society, but the time is not so far. Some people will face problems that are not trusting technology and people who are living in a poor connectivity area. Some people are also concerned about the privacy and security of their money in a cashless society.
The Disruption of Digital Currency
Today many people are skeptical about digital currencies. Cryptocurrencies gained popularity after the value of bitcoin has increased significantly. Many people are investing in crypto coins via bitcoin fortress software. Some countries have banned the usage of cryptocurrencies due to some fraudulent activities and threats to the banking and current financial system.
Despite this, the government of several countries has accepted cryptocurrencies as a viable currency system. It is expected that the digital currency will disrupt the present currency system in the future. However, it is very hard to predict when and how digital currency will get a stable position in the financial market.
Change in Banking Operation
The banking industry has changed significantly in recent years. With digitalization, people are now more dependent on mobile banking, internet banking, digital wallets, etc. Additionally, the banking system has adopted technology to meet consumer expectations, policy changes, and the security system of the banks.
Artificial intelligence is going to provide better customer services, secure transactions, etc. Moreover, blockchain technology will allow banks for real-time information exchange, faster, and transparent transactions. Banks without the proper technological infrastructure are going to face a lot of problems in the near future.
Tax Evasion Will Reduce
In a cashless society, tax evasion will not be possible. As it is easy to pay money by hand which can be done hiding to the government. But with digital payments or with digital currencies everything will be recorded and it can be easily found if there is tax evasion. This is good news for the economy and there will be less corruption.
APIs in Banking Service
Banks are now automizing every service by providing an open banking system. This has been possible for many banks due to the adoption of APIs (Application Programme Interfaces). Now this application will help customers to connect other services to the banking platform.
This will allow the banks to provide different services through the application by creating a network. This application will help many services like financial institutions, businesses, and private clients for sharing the information of customers in a safe way. As a result, customers can avail of different services through the API.
With civilization people gradually accepted money as a means of trading. But initially, people were hesitant about the concept of money. Similarly, many people are opposing digital currencies as a viable system for the exchange of goods and services. But the time is not so far when digital currencies will be the mainstream of the financial transactions.