Helen Martin: Cashless economy could turn banks into Big Brother

Some weeks ago my husband was, as usual, golfing '“ a hobby and sport which involves a healthy level of man chat and debate with fellow players.
The Treasurys currency review suggesed that 1p and 2p coins could be abandoned. Picture: PAThe Treasurys currency review suggesed that 1p and 2p coins could be abandoned. Picture: PA
The Treasurys currency review suggesed that 1p and 2p coins could be abandoned. Picture: PA

The topic that day was figuring out the end-game banks had in mind. Why would they close all their branches, greatly reduce advertising and abandon any efforts to improve customer satisfaction or attract new account holders in a competitive business world?

What was going on behind the scenes and why was the Prime Minister refusing to demand better banking services, more transparency and more remaining branches for the electorate?

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“Himself’s” golf mate happened to have a pal in a relatively senior banking position and vowed to ask his opinion. When it came back, it sounded a little futuristic and almost fanciful … that the banks were working with government towards a cashless society in which hard currency didn’t exist.

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All payments for anything, including a charity donation or a bar of chocolate, let alone a house purchase or a new car, would be made through a bank. We literally could not spend a penny without them.

Surprise, surprise – last week the UK Government and Treasury announced a review of currency which did include abandoning 1p and 2p coins – fortunately a clause that was immediately ruled out by the PM after protests by charities. Other proposals under consultation involve ditching £50 notes, and imposing limits on how much we can spend on cash transactions so that it becomes illegal to pay tradesmen and other workers “cash in hand” and helps limit tax evasion and money laundering.

According to the Treasury, cash will be used in this country for less than 20 per cent of transactions by 2026. Despite any changes, they claim they would maintain ATMs for the “vulnerable” who depend on cash.

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Some MPs were wary of the plans and how far they could progress. Limits, or eventually an end, to cash transactions could also restrict freedom and invade privacy. Others resented the Treasury’s plans to “run the show” by working hand-in-hand with banks, and even some ministers are rumoured to be predicting a backlash from the public and businesses which will mean the project may not go ahead.

Suddenly that “futuristic and fanciful” bank goal is already under way with the possibility of banks ultimately handling all transactions from miniscule to massive and becoming as much an essential utility as water and electricity.

With branches closed, how would customers query payments, banking errors or complaints without pushing 20 phone button options to speak to a call centre in the sub-continent?

All secret sins would be open to bank scrutiny, whether it’s gambling, buying excessive booze, or even having illicit affairs … some folk might think that is healthily discouraging, others may see it as a controlling Big Brother development.

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But if banks and the Government work so closely together, who and what would monitor banking policies and behaviour which have already been exposed as corrupt and exploitative of many customers … with very few penalties imposed as a result?

Now I admit, maybe all of this is negative speculation, looking at the worst possible outcome of this potentially terrifying “partnership” working for a cashless society. But everyone is entitled to respond to the Treasury’s consultation document “Cash and digital payments in the new economy” by the deadline of June 5.

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