Cash Loses “King” Status

Cash has been dethroned officially.

The Treasury Department is slowing down printing physical tender, reports The New York Times. In fact, production of bills hit a modern-day low, and $10 bills didn’t get any printing love last year. The Times’ Binyamin Appelbaum reports:

“Cash transactions are notoriously hard to track, in part because people use cash when they do not want to be tracked. But a simple ratio is illuminating. In 1970, at the dawn of plastic payment, the value of United States currency in domestic circulation equaled about 5 percent of the nation’s economic activity. Last year, the value of currency in domestic circulation equaled about 2.5 percent of economic activities.”

Part of that cash decline, according to the article, is simply that bills are lasting longer thanks to technological advances. Another reason? Electronic payment technologies are trumping paper bills as consumers’ payment preference.

Still, a cashless society, we will probably never be. Cash works well for criminals and tipping, points out The Times. We agree, but expect bills to continue to take a further backseat to newer virtual payment providers. As emerging payment companies like Square continue to rise in popularity with Americans — and eliminate the need to even carry small amounts of money — the decline in cash should only plummet faster. In payments, convenience wins.