WIZZIT logoCash is the enemy

by Brian Richardson, CEO of WIZZIT International
FEBRUARY 15, 2018

cash is the enemy

For Financial inclusion to be a reality a number of critical factors need to be in place. There is little or no doubt that the benefits of financial inclusion far outweigh the enormous downsides of an unbanked population. We need government support. We need support from the banks, the telcos, the retailers, the fintechs, the card associations:


- It does not help when European Central Bank executive board member Yves Mersch... gives a spirited defence of cash, praising its ability to facilitate privacy, equality and security, insisting there is "no viable alternative". This type of thinking and public statement takes us backwards - at speed. 


- It does not help when progressive regulators promote a risk based approach to KYC with various levels to faciltiate access and none of the banks make use of the various exemptions. 


- It does not help when the Telcos do not open their USSD gateway to the banks so that they can promote financial inclusion amongst the vast majority of the population who have feature phones. 


- Digitalisation is not the preserve of the smart phone owners. 


- Setting up Digital Only Banks for the middle and upper end of the market (owners of smart phones and users of APPS) does not help.


- It does not help when the playing fields are not level and different rules exist for different players offerng the same products and services.


- It does not help when big players use their positions of power and their size to prevent other players who have a genuine desire and passion for financial inclusion.

Cash needs to be eliminated or at least reduced  - urgently. The cost of cash for economies and individuals is huge. Safety and security issues are rife. One can lose your life for 20 bucks - so much for "cash is free" when it carries the highet cost of all. Cash cannot be traced hence the preferred means of money laundering, funding terrorist activities and other illegal. illicit  and dark activities. Make bank accounts accessible to all  - a birth right and then all transactions have a full and traceable audit trail. Why are mobile money operators so concerned about making it easy, cheap and convenient for users to access cash. Make it cheap/free to fund the mobile bank accounts and to transact through this account and expensive to draw cash. We have to change behaviour to a cope in a digital world. We have to have the merchants on board accepting digital payments. As ecommerce and on-line shopping explodes, we have to provide the mass market with the digital payment mechanisms to be active participants. Government has to take a stand and refuse to accept and disburse cash. 


We have a long way to go and no single entity can achieve the goal of inclusion on their own. It is going to take a collaborative effort from everyone - and everyone can share in the benefits.


SOURCE: Finextra https://www.finextra.com/blogposting/15032/cash-is-the-enemy


Brian Richardson is the co-founder and group CEO of WIZZIT International. Brian is recognised globally as a disruptive innovator in the financial services space. He's fostered powerful partnerships with major FSPs around the world to advance mobile banking technology.