The Coronavirus pandemic could leave 43.6 million people at risk of exclusion in cashless US
Q2 2020 hedge fund letters, conferences and more
- 43.6 million people are at risk of digital exclusion in the US due to a decline in cash use during the pandemic, including the elderly, unbanked and homeless.
- Restrictions put in place during the Covid-19 pandemic have seen a widespread closure of banks and rise in large cash withdrawals,
- There are an estimated 553,747 homeless people in the US, along with 14.1 million unbanked adults and 52.5 million residents over 65 years of age.
American Adults Are Vulnerable To Digital Exclusion
New Global Payment Trends research reveals that a decline in cash use during the pandemic could leave 43.6 million adults vulnerable to digital exclusion in the US.
Although it’s still the second-most used form of payment in the US, cash use has seen a significant decline over the last five years, with 29% of adults now saying they make no purchases using cash during a typical week, compared to 24% in 2015.
This decline could be exacerbated by the Covid-19 pandemic, which has seen the country under lockdown restrictions since March. This has led to many Americans panic-withdrawing substantial sums of money and choosing to buy groceries online rather than in store.
There are significant implications for vulnerable members of society who struggle to use digital payment services, such as credit cards, mobile wallets and bank transfers.
1/3 Of US Seniors Do Not Have Internet Access
Latest data shows that one third of US seniors do not have internet access, 14.1 million people are underbanked or unbanked, and 11.4 million suffer from serious mental health issues each year. In addition, there are around 550,000 homeless people in the US.
This suggests that at least 43.557 million people would be at a loss in a fully cashless society, either due to struggling to use digital services, being unable to monitor overspending and falling into debt, and relying on others to purchase essential items on their behalf.
On top of digital exclusion, other concerns resulting from a decline in cash use include security, sociability and savings. This has led some areas to reject card-only policies, including Philadelphia and Massachusetts.
Given that a third of Americans cite cash as their favourite payment method and over half (53%) plan to always have cash with them, it’s essential that cash remains in circulation to prevent vulnerable members of society being excluded.
To read more about the impacts of digital exclusion on Global Payment Methods, visit: https://a2zcasinos.org/global-payment-trends/
