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A cashless world

In Europe, experienced travelers get cash from ATMs and avoid using credit cards. Helping to drive this practice was the fact that most U.S.-based credit cards lacked the chip & pin combination used in Europe, which adds a tiny degree of hassle when using a credit card over there. Although we're now getting the "chip" part in our cards, our banks have generally opted to retain signatures instead of mandating pins, so the practice of relying on cash still stands. But what happens when other countries really stop using cash? This New Yorker article gives a pretty good idea of what may lie ahead: Imagining a cashless world. (Note the side benefit of the drop in street crime when people stop carrying cash.)

I should hasten to note that this change has not hit the major European countries yet and that the advice to use an ATM/cash combo still is good, so don't panic if you are headed overseas anytime soon. Still it is interesting to consider how things will likely change in the not too distant future. Of course, by then we'll probably be buying everything with our phones anyway. (Potential trouble for those who shun taking a phone as a traveling companion.)

Posted by
16766 posts

I disagree that experienced travelers avoid using credit cards. Some may, but many others (I'd guess most truly experienced travelers) make sure they have no-fee or low-fee credit cards and use them frequently.

Posted by
23402 posts

I use more cash when I go to Europe, especially Germany and Italy, but here at home in the UK I almost never pay for anything with cash any longer.

Virtually all my purchases under £30 are by Apple Pay or contactless debit or credit card. If it is a larger purchase it will be by credit card, unless it is my car tax or a flight on EasyJet when it will be a debit card.

An increasing number of restaurants are now participating in payment apps like fly pay and qkr which means your phone has the bill shortly after you order, you can split the bill if you want, and there is no messy catching the waiter and asking and waiting for the bill, and no cash or card changes hands.

I keep a couple of £5 notes in my wallet just in case, and said to my wife just today that she could have one of them to pay a farmer for a dozen eggs (an unattended honesty box, and she had to get change first). I'd had them for weeks.

This has all come pretty quickly, perhaps the last year for contactless for me and only about 4 months since I upgraded my iPhone for the Apple Pay.

I'm now starting to leave my cards at home unless I expect a big purchase, or have to fill a car tank.

Posted by
2070 posts

Bring it on. Cash is a bother; I would charge everything if I could. Using a card with no foreign exchange transaction fees in Europe, of course.

Posted by
553 posts

Last week we visited Cartmel Priory in the English Lake District. They have the usual box for cash donations, but also a machine so that you can pay with a debit or credit card. It was unattended, so I don't know how U.S. visitors with swipe cards would manage.

Posted by
3580 posts

When I was in England recently I met a man who said he didn't carry any cash any more, just a credit card. I decided to try it here at home in the USA. On vacation, I'm using my chip card almost exclusively. It makes transactions quicker. There's no fumbling around for cash, no trips to the ATM to replenish supplies, and I imagine businesses love the efficiency. Besides, cash is germy. Faster, cleaner...... When the bill comes I may not be so enthusiastic! But I'm getting points for everything! I'm not asked to sign for smaller amounts, I noticed.

Posted by
2409 posts

Sweden 2015: I did not go to the ATM once. Swedes did not want any cash, even for a purchase worth pennies. It was WONDERFUL.

I I have a no fee and good exchange rate CC with chip and signature. It was fast and easy. And also a great way to have a detailed record of where you spent your money after the trip. And my CC use helps to earn more travel money. I loved it! I am disappointed with the slowness of our chip system. I also suspect Greece will be a far cry from Sweden's technology. My daughter never uses cash here in the US so it is an option here as well, but perhaps a generational or regional issue.

Posted by
11497 posts

Helping to drive this practice was the fact that most U.S.-based
credit cards lacked the chip & pin combination used in Europe, which
adds a tiny degree of hassle when using a credit card over there.

We haven't had any problems using U.S. pin-and-signature cards (Visa/ Mastercard) at businesses which take cards AT ALL. Some of them do not take any kind of cards so then we use cash. No issues. We also use a fair amount of cash right here in the U.S. so it's not that much different. We're not crazy about having our card info out there anywhere and everywhere, and no interest at ALL in using phones to pay for stuff so it's a matter of personal preference.

I will mention that we don't rent cars in Europe so we don't have the issue of trying to fill them at gas stations which may only take chip-and-pin.

Posted by
12091 posts

"...which adds a tiny bit of hassle when using a credit card over there." That's a premise I don't agree with, since I don't see it that way. I use cash and my US credit cards, both the chip/signature and the magnetic stripe, over there, Main thing is to know when the US card can be used or not. In Germany and Austria no problem.

Rock bottom reserve I carry always 100 Euro in cash. If you board a Westbahn train in Austria, you're not going to pay with a credit card. In that situation I pay the conductor in cash. You board a bus in a city, say Wiesbaden, you pay the driver cash. If I buy a train ticket at the station from the ticket machine or a staffed counter in Austria or Germany, I use either cash or a credit card.

Paying for staying at the Pension in Berlin, be it 4 nights or 10 nights, I pay in cash. That's the way the proprietor prefers it. Other hotels I pay cash or with a credit card.

"...buying everything with our phones anyway." I don't use a phone.

Posted by
11497 posts

"...buying everything with our phones anyway." I don't use a phone.

Fred, we don't even take phones to Europe. Yet. We don't own smartphones (we have pay-as-you-go flips for emergencies only) and are putting off having to own them as long as possible. Wifi works well for us for checking mail and some other stuff on an ipad. I have friends in Europe who do not own phones at all.

Posted by
12091 posts

@ Kathy...I'm with you. I meant the smart phone in not using a phone. Of course, I take my flip cell phone over there since the family insists on that. But that's limit to the electronic gear. I am not sure that the Pension I stay at in Berlin even has Wifi. I think not. For checking on e-mail and using the internet, I go to an internet cafe or use the computer provided by the hotel, assuming you can log on.

Posted by
20 posts

@Kathy, unfortunately your talking point about smart phones stopped being true the moment you connected your first iPad to a WiFi network ...Your emergency phones simply give you access to all connection networks voice & data whereas your iPad only connects via wifi data, but you still have full abilities to make calls and, obviously, connect via data whenever you're in range of WiFi, thus you already have a smart phone, just a slightly more inconvenient one.

Welcome to the future! :)

Posted by
30932 posts

From what I've seen we're definitely moving towards a cashless society, at least in the developed countries. Government and businesses started to move towards that years ago with direct deposits of paycheques, pension cheques, etc. Most of my purchases these days are with a debit card, either using the C&P or the "tap" system and I rarely use cash anymore. Even the parking meters here are being converted to card use, so I don't even need coins for those. I've recently started using Apple Pay and as soon as my primary financial institution is set up for that, I won't need to use a card for the majority of my transactions.

I found this year that many countries in Europe aren't set up for Apple Pay yet, so it's probably going to be awhile before I can use that while travelling.

Posted by
11497 posts

..but you still have full abilities to make calls and, obviously,
connect via data whenever you're in range of WiFi.

I realize that. We just don't use it that way.

Posted by
4684 posts

Even in the US, I can't use Apple Pay, because I have a pay-as-you-go plan. No data today means no Apple Pay today. The $1,000 a year I save can go towards my travel budget.

I don't dispute that Apple Pay's tokenizing, which avoids giving the merchant your card number is a great idea. But I can't use it.

Edit: Nigel, I said I have a pay as you go plan. I don't use or pay for the phone for days at a time. I was describing the $1,000 I save over having a "death-by-the-month" subscription for Verizon's CEO's bonus payments. And I don't have to check my Facebook page every ten minutes, saving me a great deal of time for other things.

Posted by
23402 posts

Wow! Your data is expensive! $1,000 a year? That's $83 a month.

I get 4G, 10GB a month for £18 or under $25 a month. Glad I get it here. Unlimited minutes in the UK and unlimited SMS, too.

Posted by
20 posts

We haven't used cash in the US or abroad in about 5 years - I have the same $60USD in my wallet as I did back then ... I should've dated it ... but we also don't pay-by-phone much. I've used google wallet and apple pay, but they're not any easier than simply using the card for me so we just don't use them. We did run into a small problem in rural France in 2014 as the gas station didn't take our particular card but we went into the store and cleared it up with a different card, otherwise no problems for anything we do. I probably haven't touched coins in 5ish years either ... kind of weird now that I think about it ...

Posted by
11497 posts

grussgott, not sure how you've managed that as it's not unusual for smaller hotels in Italy to operate on a cash-only basis (we've stayed at one of those), and smaller businesses as well. We've eaten at restaurants in Italy that only took cash, and had libations at pubs both in the U.S. and abroad with the same policy.

Posted by
20 posts

@Kathy, yeah that's an interesting question ... I guess we only stay in large cities at major hotels and we don't eat out, but we do a lot of driving although I guess we've just been lucky to never have had to go anywhere that doesn't take CCs. I asked my wife and I did kinda lie - last Canadian Thanksgiving we were in Montreal and we shopped at the Jean Talon farmers market and my wife did pay for everything there in cash ... but that's the last we can remember or have a record of - all of our trips have been cc or other means (others paid or we paid through a service like Uber, etc) We even got in a bit of tussle in Paris in oct 2014 as we ordered an uber to take us from downtown to CDG and there were some protests and they were beating on cars and pushing around people. The driver called us and met us at the back of the hotel and then we snuck out of the area on side streets.

Posted by
12091 posts

One can be certain that in Germany if you stay in Pensionen in smaller towns and even in big cities, even if a Visa logo is displayed, paying in cash is much preferred or is the only option. That's also the case with restaurants, definitely smaller ones, taking only cash. The first time (in 2009) I stayed at the Berlin Pension, I saw the Visa logo and handed the credit card to the proprietor. She asked if I could pay in cash, which did surprise me. What am I going to say, no? So, I paid the whole amount in cash.

Posted by
20 posts

Yeah it's because there's a fee and also maybe because now there's a digital record :) Personally I say "no" because I want my points - the customer is always right :)

The trick in the EU is having a fully European acceptable chip-and-pin (rather than the chip-n-sig). First Tech CU and UN CU offer them. Overall we each have a Chase Sapphire Reserve (chip-n-sig) which is such an awesome deal that we pay for everything everywhere on that. Every possible expense business, leisure, or personal goes on those cards now for us.

Posted by
30932 posts

"even if a Visa logo is displayed, paying in cash is much preferred or is the only option."

I've found the same thing in Italy. Even hotels which accept credit cards will offer a discount if the bill is paid in cash. I'm usually able to obtain the cash from ATM's so I always take advantage of the discount, which as I recall is about 5%.

Posted by
20 posts

@MrsEB - I don't think anybody is saying that phones would be the only option for conducting commerce, simply that it's another option which, for many people, is massively convenient.

For example, at the grocery stores where I live, I"m waiting in line to checkout and usually looking at things on my phone. When it comes time to pay I just touch my phone to the keypad and done. That's great!

Or when using Uber or Lyft or similar services, you don't even need to do that: you simply get in the car, and then leave the car. Tips and everything these days can all happen on phones: valets, bellstaff, restaurants, car services, waitstaff, etc etc. And there's a much higher level of personal security with this model: you don't have to be fishing out your wallet that's easily stolen. In fact you can move your wallet into your bag and clip it in. All services can run from your passcode-protected, data-encrypted phone. I'd say the decrease in street crime alone is worth it. For example, I use android. If my phone is lost or stolen I can find the nearest computer and wipe it, use my credit cards to buy a new one, and be back to 100% 20 minutes later with no loss of data, information, or money, save the phone (which may be covered by insurance).

So I'd say mobile apps connected to payment systems has been one of the biggest hassle reducers I can think of in my daily life and I love it! But I still have a wallet of credit cards that I use about 20% of the time.

Posted by
30932 posts

"Phones can be hacked. I'll take cash and my contactless credit cards any day."

It's actually much more difficult to hack an iPhone as the card information is not stored in the phone, but rather in an encrypted file in the payments chip, and even if the phone was stolen and didn't have a screen lock, the card details are not accessible. In addition to that, each transaction is tokenized with a unique number, so even more difficult for scammers.

OTOH, contactless cards can be easily scanned using RFID readers, which can be assembled for very low cost. There are numerous examples of this being done as it's very easy to do.

https://www.youtube.com/watch?v=SPiyftJZ9jo

Posted by
30932 posts

Keith,

"Scanning the RFID does not allow someone to duplicate the contactless payment ability."

It's not necessary to duplicate the contactless payment ability in order to use the card. Did you watch the video that I linked? It is still possible to make "card not present" transactions over the phone or the net using the information obtained by scanning the card surreptitiously.

Posted by
57 posts

We do not have a pin for our credit card with a chip. Will we be able to use it in Europe?

Posted by
308 posts

Getting by without cash was easy in Scandinavia this year, except when I needed change for a public restroom!

Posted by
30932 posts

jraiche123,

I can't answer your question as all my cards are Chip & PIN. You might want to start your own thread on this topic, as other forum members will be able to provide some information on that.

Posted by
20 posts

@Rita, same experience here, it's quite easy to travel in Europe without cash - however based on this thread I'd say it depends quite a bit on where you go and what kind of places you're doing business with. We haven't used cash in years, but we also don't go to small pensions or do much business in rural shops / restaurants. That said, 18 months ago we drove all over Germany, Switzerland, Italy, France, and Belgium and barely had a hiccup using all cards - we even hit some small co-ops around Ghent with no problem.

I think the opening line of this thread is misleading: "In Europe, experienced travelers get cash from ATMs and avoid using credit cards. " I've actually found the opposite of this to be true - routine travelers to Europe that I know are cashless and many (maybe all) have Chip-and-PIN cards. If by "travelers" the OP means backpackers or people moving between small pensions, rural shops, etc maybe that's true, but then that's true in America too.

In fact my perfect trip would be to get on a plane to Europe with the clothes on my back, a passport, and 3 credit cards; it's urban survival from there.

Posted by
12091 posts

This past trip and the recent ones I've found it best using a combination of both, cash and credit cards (chip and signature and/or magnetic stripe) in Austria, France and Germany, depending on the particular situation. Obviously, you had better have cash, ie change to use the WC at train stations, even though in German train stations it's mostly uniform since Rail and Fresh run the facility, ie one Euro. I bring 3 credit cards, use two, one in reserve.

Posted by
332 posts

Northern Europe would be the first and biggest advocates of a cashless society however, the reality is cold hard cash still rules. Travel through any of the Southern European countries and you'll be using cash just as much as your CC. Many merchants and business owners prefer not paying the service fees that the CC companies demand, not to mention their general distrust of the the banking/finance industry. Many hotels/B&B's will give you a discount for cash, otherwise, you're walking down the street with them to go to their cousin's shop to run the card on their machine. While the idea of modernity is fascinating, and the use of vending machines is much more prevalent in Europe, cash will continue to be used for quite awhile.

Posted by
8569 posts

@jraichel......most Americans who have chip cards have "chip and signature." That's what I have. No pin.

I've been in Europe nearly 4 months this year and have never had a problem using the card. They are used to it.

The only caveat may be trying to get gas from an automated pump (no attendant) or some rail ticket machines. (I buy my tickets online and either print them out or keep them on my phone.)

I try to use my credit cards as much as possible--love those points--but do pay for some smaller items in cash--mostly taxis, tickets bought on buses, etc.

Posted by
114 posts

As stated on this forum, cash is still king in many situations in Europe, and is appreciated by servers and others who need to make as much money in tips as they can in a short tourist season (for example along the Adriatic). While the techno advance lets you do all kinds of things with a credit or debit card, the current crises in Europe are soothed slightly by paying your taxi driver a small tip and letting him pocket real money. We live in a world with all sorts of benefits, and may not appreciate why cash. that need not always be declared as income, is so welcomed by the small people in the tourist industry, who make it run, but get the least money out of it.

Posted by
3226 posts

While many might claim that we are approaching a cashless society, especially the credit card issuers, the world just isn't there yet. As long as there is cash, there will be plenty who prefer it.

Governments can claim that there is widespread corruption and a major loss of tax income when cash is the primary payment option. That may be true within certain segments of society, but overall I feel the majority of people and businesses are honest about their cash use.

The main roadblock preventing greater acceptance of credit and debit cards (and their offshoots like Apple Pay and other smart phone based systems) that everyone seems to want to use is the card issuers themselves. The high fees they charge the merchants actually prevents many from accepting that payment type. On a recent trip I took to Philadelphia I was shocked that practically no small convenience stores or fast food places accepted anything but cash. This is not some third-world out of the way place. Why? Those I asked stated that the companies they had to deal with to get connected to the credit card networks simply charged too much for the small amount of business they do. When the network fees were added, there is no economic reason to take cards. One merchant told me he would rather take the chance he would get robbed on the way to the bank than pay what was required. Until these costs come down relative to the cash handling costs, there will be no mad rush to take plastic over cash.

Don't get me wrong. I do like using my credit cards. There are very few things I pay cash for anymore around where I live. It is quicker than waiting for the cashier to count out change and I don't have to walk around with a pocket full of coins that it takes too long to count out.

Posted by
12091 posts

"...the world isn't there yet." True, if you taken into consideration Asian tourists who have the reputation of carrying large amounts of cash on their person.. Cashless if you're thinking American and certain countries in Europe where credit cards are widely accepted, not so in Germany. Between France and Germany, my experience has been cash is way preferred in Germany.

Posted by
17647 posts

Not only is cash preferred in Germany, it's also the most economical way to pay. I find that a lot of small, inexpensive accommodations and restaurants don't take plastic, so if you are trying to save money, you can't use your cards. If you only go to places where you can use a card, you will spend more.

One merchant told me he would rather take the chance he would get
robbed on the way to the bank than pay what was required.

He would rather possibly get robbed on the way to the bank than definitely get robbed by the bank.

Posted by
11497 posts

I guess we only stay in large cities at major hotels and we don't eat
out

Well there ya go, grussgott. On holiday, we don't stay in many of the large hotels, do eat out at least once a day, and have run into many smaller businesses that either won't or don't like to take CC's. So every traveler's experience may be different. In ours, cash has been far from obsolete and we prefer that to having to be tied to a device.

Posted by
30932 posts

" The high fees they charge the merchants actually prevents many from accepting that payment type."

That seems to be the main reason that Wal-Mart in Canada is no longer accepting VISA cards......

http://www.cbc.ca/news/business/walmart-visa-credit-cards-1.3763116

Using cards and things like Apple Pay are in some ways more convenient for retailers, especially as the money ends up in their account very quickly and no worries about being robbed or having to keep large amounts of cash on hand.

Despite the fees, I'm sure cards and E-payments are here to stay.