A Cashless Canada Would Short-change Citizens

Cash is more than just another payment option, it is fairest way to transact—with none of the barriers to usage seen with cashless options—and it does not discriminate. As Canada is on course to become one of the most cashless countries in the world, multi-platform magazine The Walrus explores how cashless policies damage the freedom of all, and disproportionately affect the underprivileged, and what can be done to support cash.

Writing for The Walrus, journalist Lucy Uprichard cites data from social justice group ACORN Canada that shows 15 percent of citizens are underbanked—meaning they have limited access to banking services—and an additional one million people are estimated to have no bank accounts at all. While for some, this limited interaction with banks is a choice, often driven by privacy concerns, there are others for whom there is no choice. They may lack access to local bank branches, be unable to meet the requirements to qualify for an account, or lack the knowledge or equipment to access online services.

Beginning with this six and a half million unbanked or underbanked citizens, and adding people who simply prefer using cash—such as those depending on it for budgeting in an increasingly challenging economy—it becomes clear that a significant number of people are already suffering from a decline in access to cash driven by widespread bank branch closures.

Uprichard points out that, in areas lacking a wide variety of shops, a move away from cash could jeopardise access to essentials. It quotes Michael Bryant, Executive Director of the Canadian Civil Liberties Association, who said pushing people to use electronic payments would actively ‘[threaten] food security’ by making it harder for people to purchase groceries, adding ‘another layer of anxiety’ to daily life.

Alongside greater difficulties with making payments, a cashless society would make receiving purchases harder for millions. Uprichard gives the example of Nunavut, in which the majority of communities have no bank branches at all, leaving many with no choice but to depend on cheque-cashing stores, which often charge extremely high fees for their services. Without cash, people who are already poor find their lives getting more expensive, and payment choice is reduced for everyone.

For solutions, Uprichard suggests following the example of countries such as France, Italy and the UK, where post offices also provide banking services. While postal banking was once the norm in Canada, lobbying from the banking industry put a stop to it in 1968. Given strong support for a return to post office banking both within the postal service and in the 1,200 communities poorly served by banks—and the fact that over 600 municipalities across the nation have passed resolutions backing it—there is hope that cash services could see a boost in the not-too-distant future.