The trend away from cash has all sorts of ramifications for central banks and society at large.
“People are familiar with the idea of giving your child a loonie or a toonie or a dollar bill, depending on how old you are, and having them drop it in the bubble,” spokesperson Rob Kerr said.
The experience will feel less familiar in 2020. The Salvation Army in November announced that its annual kettle fundraising campaign in Ontario would be “proactively taking a digital turn” by switching to a mostly online fundraising effort, via FilltheKettle.com, in COVID-19 hot spots. On Dec. 14, the Sally Ann said Christmas kettles would also be absent from Manitoba’s street corners and shopping malls due to the pandemic and the provincial government’s related restrictions.
“This is the year when a lot of our traditions are shifting,” Kerr said in an interview on Nov. 24.
The adjustments were necessary to protect volunteers from a highly contagious and deadly disease. But the Salvation Army, one of the country’s oldest charities, is now also one of a growing number of entities coming to grips with a simple fact: people are using cash much less often to pay for things, and that trend has all sorts of ramifications for central banks and society at large.
The move to a cash-lite society has been happening for a while. Payments Canada, the non-profit that owns and operates this country’s payment clearing and settlement systems, found that the number of overall payment transactions by cash declined to 18.4 per cent in 2019 from 32.8 per cent in 2014.
COVID-19 appears to have accelerated the trend. Some grew fearful of handling cash amid reports that it could be a conduit for the virus, but there has also been a shift to e-commerce fuelled by the forced closure of brick-and-mortar stores. Online sales by traditional retailers increased more than 74 per cent from a year earlier in September, according to Statistics Canada.
This trend may be creating a lot of convenience for consumers, but policy-makers see cash as a public good and, therefore, feel duty bound to ensure it (or, perhaps, something like it) is there for people to use.
Adding to that concern are…