Enter 2022. The technological landscape is ever evolving and with it, payment methods. More and more, the way consumers pay continues to change, increasing demands for business to accept various methods. As the payment landscape continues to shift one question asked by business and customers alike is whether cash is still relevant and if not, how instead will consumers be conducting their transactions?
For this coming year, online and remote transactions are predicted to rise (and with them, concurrent expectations of rising fraud). Reports show that most online transactions are completed with a credit or debit card. Both payment methods have continued to be prevalent with 1.06 billion credit cards being used in the United States last year. And so, while payment methods continue to expand and migrate toward new fintech platforms such as Apple Pay, legacy credit card usage isn’t likely threatened in the near term.
Peer-to-peer payment (P2P) applications such as Venmo, Cash App, and more continue to garner larger amounts of subscribers as each year passes. Several operations now accept a P2P payment method instead of cash, and even some of the largest retailers now accept Venmo – all efforts to keep up with the buying preferences of “digital natives” (Gen Z and Millennials).
Similarly, the emergence and impact of cryptocurrencies on our society cannot be ignored. In 2021, 13% of Americans had traded in a form of crypto during the previous 12 months. While crypto may not yet be widely accepted amongst retailors as a form of a payment method, its presence must be noted. With its increasing popularity one must speculate that crypto may play a larger role in our transactions down the road.
With all of that being said one is left to wonder, is cash obsolete? What role could cash possibly play in 2022?
Cash plays a much more substantial role in today’s payment landscape than one might think. In 2020, cash still made up approximately 1 out of every 5 transactions. Mind you, this was in the midst of the COVID-19 Pandemic in which various lockdowns and shutdowns occurred and where many consumers and retailers alike avoided using cash as a health precaution. It is safe to assume that if cash was still one of our main payment methods in a year like 2020, cash transactions going forward could be even higher than the numbers we saw back then.
The need to use cash in our society is still prevalent. A national survey by the Federal Deposit Insurance Corp found that 6.5% of U.S. household are unbanked, and 18.7% more households are underbanked, meaning about 25% of the population still relies heavily on cash as opposed to payment methods tied to a bank. CashMatters.org cites that some of the top reasons for the persistent relevance of cash are its protections of privacy and freedom of choice, the minimal risk, and the security.
Another surprising fact? The US Government is still printing a substantial amount of new bills. In 2020, the number of new bills printed and put into circulation reached a historic high at 50.3 billion notes distributed across the country. Projected trends for 2021 are likely to be even higher, making it clear that cash will continue to be relevant throughout 2022. Unfortunately, cash’s relevance to a business also means relevance to a fraudster.
Fraudsters continue to use fake notes to their advantage. Already this year numerous reports of fake bank notes have surfaced. At the beginning of this month, authorities in Saint George, Utah discovered over $20,000 worth of counterfeit bills. Previously to being caught, these fraudsters had already used fake bills in various retailers across California and Nevada alike.
Regardless of the digital strides being made to achieve a cash-less society, it is important that companies remain vigilant in their counterfeit cash detection efforts. Falsified bills still circulate and pose a threat to unsuspecting businesses. Here at UVeritech, Inc we have been in the Fraud Fighting business for over 20 years and are the market leader in producing UV light counterfeit detector products that catch fake documents before they reach the cash register. We would love to partner alongside you to help protect your company from fraud.
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Allie Roberts is a content writer at Fraud Fighter with a focus on new fraud trends, identity authentication solutions, and counterfeit detection. Her articles aim to help businesses realize and reduce their susceptibility to fraud.