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Abu Dhabi, UAESaturday 22 September 2018

Changing times: contactless payments now the norm in London

Buskers and even churches now have contactless card readers, but not everyone is sold on the war against cash 

Busker Charlotte Campbell, who uses a contactless card reader for donations in addition to cash, performs near the London Eye in central London. Photo: AFP

For centuries, London has sustained a street-level economy where performers and vendors make a living from the spare change of strangers - but they are being forced to adapt as cash falls out of fashion.

Busker Charlotte Campbell, who sings for her supper almost every day in the shadow of the London Eye, a top tourist attraction, was one of the first performers to use a contactless card reader.

"Things are changing in London and people tend to use cards to pay for things," says Ms Campbell. "That makes busking a dying art if people aren't carrying cash any more."

Between 5 and 10 per cent of Ms Campbell's income now comes not from coins tossed into her guitar case, but from people tapping bank cards on her reader - set up through her phone to debit £2 (Dh9.49) at a time.

It's a rising trend: a report from the British Treasury earlier this year revealed that cash accounted for 40 per cent of all domestic payments by volume in 2016, down from 62 per cent in 2006.

The same report predicted its share of payments would fall to 21 per cent by 2026 - bringing Britain to the brink of becoming a cashless society.

In January, the government spurred the process by outlawing surcharges for using debit or credit cards in shops, removing one of the only significant downsides to digital payments for consumers.

Busker Ms Campbell was one of the first performers to use a contactless card reader. Photo: AFP

There are other signs in the British capital that businesses are cashing in by banning coins and notes.

A number of lunch spots in the City of London - the epicentre of the country's finance trade - now warn customers with prominent signage that they are entirely cash-free. Others assume that card payment is the default at the check-out.

And some street vendors of The Big Issue magazine - part of a charity scheme to lift people out of poverty and homelessness - have also taken to carrying contactless readers to attract passersby who are not carrying cash.

At Christ Church in East Greenwich, in southeast London, helpers still pass around traditional tithing bags to collect donations from the faithful during Sunday service.

But Reverend Margaret Cave has also been recently deploying a contactless card reader to mop up one-off donations from her flock - young and old alike.

"I've taken card payments from our 93-year-old member of congregation and some of our much younger people," she says. "You know it's safely and securely going through to your bank account, no one can take it - so it's much better than having cash from that point of view."

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But not everyone is sold on the benefits of moving towards a fully cashless country.

"The big problems of a cashless society tend to be split into three areas," says finance expert Brett Scott, author of The Heretic's Guide to Global Finance: Hacking the Future of Money.

"There's the surveillance element, that you can be watched; there's the financial exclusion element, that you might be excluded from the system; and then there's a whole cybersecurity question," he says.

He says banks, card companies, government departments and financial technology firms have all been engaged in a two-decade long "cold war against cash", attempting to convince the public that coins and notes are an unwieldy inconvenience.

"In some ways, you can think about this a bit like the gentrification of payment," he says.

"They're trying to push all kinds of informal activity or non-institution-based activity into a kind of digital enclosure that can be watched and can be managed by large institutions."

Authorities are keen to move away from cash as the recording of transactions makes it harder to avoid taxes, as well as to finance terrorism.

But the homeless, refugees and others who struggle to secure bank accounts could be shut out of this new economy, Mr Scott warns.

Recent history also seems to vindicate those with concerns about overreliance on card technology.

In June, 2.4 million British card transactions were affected by a Visa outage - leaving pubs, shops and restaurants struggling to do business during prime trading hours on a Friday night.

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The future is contactless

According to Infiniti Research, a global market intelligence solutions provider, contactless payments are among the technology trends influencing the future of banking.

Infiniti Research says advanced ATMs have transformed the whole banking system. In the future, it says, customers will be able to perform contactless ATM transactions using a mobile phone. Numerous innovations in this space have previously been applied; for example, iris recognition or biometric authentication at ATMs. These technologies improve retail banking security and stop hacking and such illegal practices, says the company.

Other innovations set to shake up the banking industry include wearable technology, says Infiniti Research. Retail banking can use smart watches, for example, to push personal greetings to customers through Bluetooth beacons when they enter a bank’s location. Smart-glasses for bank tellers are also being considered to process customer banking information for the employee as the employee is instantaneously doing other customer service tasks. And the use of extended reality, which refers to virtual reality, augmented reality, and mixed reality, could see more meaningful customer engagements and also improved workforce performance.

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