Are We Living in a Cashless Society?

People always like to ask about the cashless society. Has it arrived here in North America? Is it on its way?

There's always plenty of talk about the cashless society. The media seems fascinated by it, and the card companies and electronic payments companies want people to buy into the notion that cash is going away. You might remember in the '80s and '90s talk of the "paperless society" and how the media was similarly fascinated about it barreling towards us. We'll leave it to you to decide whether a "paperless society" has arrived yet or not, all these decades later.

The truth is, we don't have a cashless society, and one isn't coming anytime soon. If there were a cashless society, cash distribution issues and costs for the banks would not be a problem. Banks would simply remove cash from their branches and shut down their ATMs. But has that happened? No. In fact the COVID-19 crisis led to a surge in cash demand from customers causing banks to react quickly to keep their branches and ATMs sufficiently stocked to meet customer demand for cash.

We're not in a cashless society; but we are in a less-cash society. We all still use cash, but we use it a bit less than we used to. We think this "less-cash society" is the worst-case scenario, and it's an area of concern for Perativ and retail bankers alike.

Why is this worst-case? Because in a "less-cash society," you still have to keep the distribution points for cash open everywhere, but with that slightly lower usage, the unit cost or the cost per cash dollar going out goes up. That increases costs for banks and ultimately for consumers, and that's increasingly becoming unacceptable to the banks. That's why Perativ focuses on helping the banks keep access to cash affordable.

How Perativ Helps in a Less-Cash Society

At Perativ, we started addressing the cost of cash distribution right after the 2008 financial crisis. We've worked tirelessly on cash optimization solutions for more than a decade in a real operating environment, and we've learned that cash forecasting is not enough, and neither is just renegotiating contracts.

Affordable access to cash is really about having an integrated automated system that drives down the cash float required and delivers direct cost savings, which we've now perfected, and the results are nothing less than phenomenal.

Through our automated cash solutions, we’ve lowered our own total cash float use by 42%. We've reduced the amount of emergency cash loads by 50%. And, we've more than doubled the number of ATMs loaded, all with the same staff.

How Perativ Improves Reaction Time and Mitigates Costs

With the current COVID-19 pandemic, we’ve experienced an initial surge in cash demand and then a drop off in usage as government confinement orders kicked in.  The Perativ cash optimization software, working at the distribution point (e.g. each ATM or TCR) level, quickly adjusted for the demand changes and mitigated cash out situations.  Further, within four weeks of initial government action we were able to temporarily reduce our total cash float by an additional 35% while maintaining uptime and customer access to cash, leaving us well positioned to smoothly manage the recovery and ramp up in cash demand as the economy reopens. 

Today, any retail bank can be this agile and access these kinds of significant savings through a partnership with Perativ, and make sure they keep cash accessible to their customers, and affordable for them to distribute.

Find out how Perativ can help you keep cash accessible and affordable.     

Talk to us today. Call 1-833-PERATIV (1-833-737-2848).

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