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The Cash Resilience Paradox

Categories : Cash and Crises, Cash is a contingency and fall-back solution
January 31, 2022
Tags : Cash and Crises, Cash substitution, Financial inclusion, Privacy and anonymity
The role cash plays in society is viewed very differently in a Lebanese refugee camp than in a London coffee-shop. Despite the inroads made by a policy of digital ‘financial inclusion’, at least half the world’s adult population have little option but to rely on cash for their survival in times of crisis.
James Shepherd-Barron

Disaster Risk Management Consultant, Author, and Founder of The Aid Workers Union

This post is also available in: Spanish

The world appears to be falling out of love with cash, a situation that has apparently accelerated with the advent of the Covid-19 pandemic. So much so, in fact, that a number of governments and central banks are now actively considering switching to all-digital currencies. “With the rapid rise of mobile and electronic payments, the long-term survival of cash seems precarious,” says the media with a collective sigh of inevitability[1].

But are such headlines reflecting what is really going on? Is cash use actually in decline around the world? As a disaster risk manager used to coordinating disaster responses, I have learned from bitter experience that the role played by cash in society is viewed very differently in a Lebanese refugee camp than it is in a London coffee-shop.

Three Paradoxes

There seem to be three main paradoxes at play: first, despite the allure of digital payments, the overall volume and value of cash in circulation around the world is rising, not falling. Second, half the world’s adult population did not make a digital transaction last year; and third, that despite the allure of mobile money, those escaping conflict or recovering from disaster rely on the resilience afforded by cash.

As survivors of last month’s super-typhoon Rai in the Philippines know all too well, remittances sent by family members from far away arrive – expensively – along digital rails but are quickly converted to cash. This is because they know what the world’s poor already know: that cash has greater value when circulating in local markets than does its digital equivalents. This is also why cash liquidity is becoming so critical in Afghanistan where the banking system has all but collapsed following the Taliban’s seizure of power.

The Original Financial Technology

Meanwhile, as Covid-19 forces us to embrace online shopping and technology nudges us towards contactless payments here in the ‘rich’ world, it easy to forget that nearly three-quarters of the world’s adult population doesn’t own a smartphone and that one-third have no reliable Internet connection, far less have access to a reliable electronic payments infrastructure. In other words, despite the inroads made by a policy of ‘financial inclusion’ at least half the world’s adult population still has little option but to rely on cash.

The original financial technology, cash has survived as long as it has because it works. At the dawn of 2022, it is still the only ‘fintech’ that satisfies the ‘double coincidence of wants’ everywhere, every time. It is resilient. It is universal. And it is also not just free to use, but, in its anonymity, it represents freedom from those who either seek to curb civil liberties or extort excessive profit from what is and should remain a public good.

For these reasons and more, we must fight to retain cash as a viable payment option, especially for societies facing disaster.

[1] Martin Wolf, Financial Times, 5 June 2017 (

This post is also available in: Spanish