There are still more indications that consumers around the world are choosing electronic payments over cash. In Sweden many public transportation systems do not accept cash while an increasing number of businesses and banks accept only cards, according to the Huffington Post.
Additionally, Canada announced last month that it would no longer mint its penny because the cost to produce the coin is more than its worth.
As the use of cash as a payment method becomes more obscure, low-income households will likely bear the brunt of the implications. Approximately one in every 12 U.S. households does not have a savings or checking account, ultimately translating to no debit card access, the Huffington Post reports.
More Americans who do not have access to banks, however, are choosing to use prepaid debit cards. These cards often charge high fees, putting those consumers with no bank access at an economic disadvantage.
Studies conducted as early as 1979 and as late as 2008 have revealed that customers who use credit and debit cards often spend more than those who pay with cash, SmartMoney reports, with some theorizing that spending cash actually elicits psychological distress while card transactions don’t elicit the same reaction, as they are more abstract notions of money.