Going cashless should be an option

The report by Slaughter & May into last April’s failure of TSB’s IT system in April last year is damning about the bank, and not much of an advert for the so-called ‘challenger banks’ set up to provide fresh competition for the big banks in the aftermath of the 2008/09 financial crisis.       Two million of the TSB’s customers found themselves locked out of their accounts after the bank attempted to shift 5.2 customer accounts from the old Lloyds Bank IT system to the system of its new Spanish parent company, Sabadell, over the course of a weekend.

But it ought to be held up as a warning of what we will increasingly face in future if we are driven to go cashless.   Buying with a card, a mobile phone or some other electronic device is all very well while the IT system behind it is functioning well.     If it fails, you are very quickly going to find yourself unable to pay bills, go shopping travel on a train and much else besides.     It is not as if the TSB failure is a one-off.    These failures keep on happening – often on a scale even larger than the TSB debacle.    In 2012 10 millions account holders with the Royal Bank of Scotland, NatWest and Ulster Bank found themselves unable to make payments after a computer systems failed.   The failure was traced back to a simple error by a technician in Hyderabad.      Lloyds and Barclays have also seen their systems fail, as has the supermarket Asda.

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The cashless society from an ethical point of view

The debate about the move towards a cashless society has been at the center of the scene for several years, now. Various angles have been taken by economists, politicians, banking institutions and sociologists. Beyond the technicalities of the debate, lies the question of freedom, of inter-citizen solidarity and of governmental responsibility. The debate cannot remain in the hands of financial specialists, it is first and foremost an ethical, political and societal issue.

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