Post by account_disabled on Feb 17, 2024 4:00:53 GMT -5
When the COVID-19 pandemic intensified, digital payments became common as people avoided using cash to prevent the spread of the virus. However, since then, there has been a push to go cashless, even after the effects of the pandemic have subsided.
In 2018, a research paper was published exploring the environmental impact of cashless societies compared to those that still use cash. The study revealed that living cashless helps the planet, and one of the reasons cited was the energy consumption of ATMs and their contribution to environmental indicators. However, although the idea seems attractive, it also poses some challenges that I will mention below.
Cash flow has costs for the planet
Every time you use cash, you participate in Middle East Mobile Number List a complex system. Every part of this system uses materials and energy, and every piece produces waste. To measure the total cost to society of money, researchers have conducted what is called a life cycle assessment.
This tool analyzes all environmental impacts throughout all stages of the life cycle of a product or process. In the case of cash, the evaluation begins from the extraction of the raw materials necessary to produce the product. The manufacturing process is then examined, considering emissions, energy and water consumption, and other associated impacts.
"Cash payment has a 36% greater impact on CO2 emissions, with the transportation of money being one of the factors with the greatest impact."
Report: Digitalization, sustainability and data centers (2022).
According to data from the Report: Digitalization, sustainability and data centers (2022), the more digitalized an economy is, the more sustainable it is. However, this doesn't mean that all cashless options are good for the planet. For example, bitcoin is very harmful to the environment. Greener cryptocurrencies exist, but they are not as good for the planet as other cashless options.
However most people are unaware of the life cycles of cash or other means of payment, which makes it difficult to judge and decide whether one form or another is more or less harmful to the planet. A life cycle assessment doesn't tell you what to do, says Peter Shonfield, an Environmental Resource Management expert in Sheffield, England. However, he notes that "it gives you an informed basis for making a decision."
Cash life cycle
To understand a little more about why living without cash helps the planet, let's explore the case of currencies. To produce coins, materials such as zinc and copper are extracted from different places. These minerals go through several separation processes and are molded into discs known as blank coins. These discs are then transformed into coins through processes at the US Mint plants. The coins are packaged and distributed to the public through banks.
Energy is required to carry out the manufacturing, transportation and distribution processes of coins, and waste and pollution are generated at each stage. Additionally, the production cost of coins does not always reflect their face value.
As for banknotes, different countries use a variety of materials for their manufacture, such as cotton fiber paper or polymers/plastics. Changing from one type of material to another can have environmental and economic implications, and comparisons of environmental impacts can be made between different types of banknotes.
Advantages of not using cash beyond the environmental
However, the environmental impact of cash is not the only reason to stop using it. There are other obvious advantages, and some less obvious ones, such as convenience, security, habit tracking, and speed of financial transactions, that can benefit you from not carrying cash.
By not having to carry bills and coins with you, you reduce the amount of things you have to carry in your pocket or bag. This allows you to move more freely and comfortably, without the need to worry about the weight or security of your belongings.
Using cash can make it difficult to track your expenses and control your spending habits. However, by going cashless and transacting electronically, you can easily access your account statements and more accurately track your spending. This gives you a clear view of your spending habits and helps you make more informed financial decisions.
By not carrying cash, you reduce the risk of losing it or being a victim of theft. While there is a possibility of losing or having your card stolen, many financial institutions offer remote blocking options in case it is lost or stolen, giving you a higher level of security and protection for your funds.
Carrying out cashless transactions is much faster and more convenient. You can pay your bills, make money transfers and make purchases with the touch of a button or using your card. Nowadays, most cards use contactless payment technology, which means you only need to hold your card close to the reader and the transaction is completed instantly, speeding up the payment process.
In 2018, a research paper was published exploring the environmental impact of cashless societies compared to those that still use cash. The study revealed that living cashless helps the planet, and one of the reasons cited was the energy consumption of ATMs and their contribution to environmental indicators. However, although the idea seems attractive, it also poses some challenges that I will mention below.
Cash flow has costs for the planet
Every time you use cash, you participate in Middle East Mobile Number List a complex system. Every part of this system uses materials and energy, and every piece produces waste. To measure the total cost to society of money, researchers have conducted what is called a life cycle assessment.
This tool analyzes all environmental impacts throughout all stages of the life cycle of a product or process. In the case of cash, the evaluation begins from the extraction of the raw materials necessary to produce the product. The manufacturing process is then examined, considering emissions, energy and water consumption, and other associated impacts.
"Cash payment has a 36% greater impact on CO2 emissions, with the transportation of money being one of the factors with the greatest impact."
Report: Digitalization, sustainability and data centers (2022).
According to data from the Report: Digitalization, sustainability and data centers (2022), the more digitalized an economy is, the more sustainable it is. However, this doesn't mean that all cashless options are good for the planet. For example, bitcoin is very harmful to the environment. Greener cryptocurrencies exist, but they are not as good for the planet as other cashless options.
However most people are unaware of the life cycles of cash or other means of payment, which makes it difficult to judge and decide whether one form or another is more or less harmful to the planet. A life cycle assessment doesn't tell you what to do, says Peter Shonfield, an Environmental Resource Management expert in Sheffield, England. However, he notes that "it gives you an informed basis for making a decision."
Cash life cycle
To understand a little more about why living without cash helps the planet, let's explore the case of currencies. To produce coins, materials such as zinc and copper are extracted from different places. These minerals go through several separation processes and are molded into discs known as blank coins. These discs are then transformed into coins through processes at the US Mint plants. The coins are packaged and distributed to the public through banks.
Energy is required to carry out the manufacturing, transportation and distribution processes of coins, and waste and pollution are generated at each stage. Additionally, the production cost of coins does not always reflect their face value.
As for banknotes, different countries use a variety of materials for their manufacture, such as cotton fiber paper or polymers/plastics. Changing from one type of material to another can have environmental and economic implications, and comparisons of environmental impacts can be made between different types of banknotes.
Advantages of not using cash beyond the environmental
However, the environmental impact of cash is not the only reason to stop using it. There are other obvious advantages, and some less obvious ones, such as convenience, security, habit tracking, and speed of financial transactions, that can benefit you from not carrying cash.
By not having to carry bills and coins with you, you reduce the amount of things you have to carry in your pocket or bag. This allows you to move more freely and comfortably, without the need to worry about the weight or security of your belongings.
Using cash can make it difficult to track your expenses and control your spending habits. However, by going cashless and transacting electronically, you can easily access your account statements and more accurately track your spending. This gives you a clear view of your spending habits and helps you make more informed financial decisions.
By not carrying cash, you reduce the risk of losing it or being a victim of theft. While there is a possibility of losing or having your card stolen, many financial institutions offer remote blocking options in case it is lost or stolen, giving you a higher level of security and protection for your funds.
Carrying out cashless transactions is much faster and more convenient. You can pay your bills, make money transfers and make purchases with the touch of a button or using your card. Nowadays, most cards use contactless payment technology, which means you only need to hold your card close to the reader and the transaction is completed instantly, speeding up the payment process.