Mubasher: The leading data and analytics company, GlobalData, announced its expectations for countries that will most likely move towards a truly cashless society by 2022, in line with the current technological disruption and digitisation of every aspect of our daily lives.
In this regard, payments analyst at GlobalData, Vlad Totia, revealed that e-commerce has accounted for $3.5 trillion of worldwide sales in 2019, and smartphones are getting widespread even across the most underdeveloped countries, according to a recent press release.
In addition, banks are gradually closing down their brick-and-mortar branches to go completely digital, while people are getting bored of waiting for days on end for international transactions to complete.
According to GlobalData predictions, Finland will top the cashless leaders of the decade ahead, being the most ready country for the transition into a cashless society. The country recorded the second place in terms of frequency of use of cards, and the fifth in e-commerce spending as a percentage of gross domestic product (GDP).
Furthermore, it is the third with regard to internet banking penetration and the second in smartphone penetration for the 2022 forecast.
This European country is set to be the first truly cashless society by 2023. It held the fifth place in GlobalData's ranking due to a slightly higher internet banking penetration or frequency of use of credit/debit cards.
Going through immense changes over the past 30 years, China is seen as a “serious contender to be the next dominant superpower”. With an “undisputed leading position” in e-commerce, with spending representing 11.6% of the country's GDP by 2022.
“The only reason why China is not higher in the ranking is due to its immense population, meaning that penetration and mainstream adoption of cashless methods take longer than in smaller countries. As of 2019, China recorded an estimated 80 billion cash transactions,” the statement said.
With over half of South Korea’s 1,600 bank branches and some governmental bodies are no longer accepting cash deposits or withdrawals, estimates show that the country is moving forward to be among the top three cashless countries by 2022.
Around 6% of this Asian country’s GDP is from e-commerce spending and more than 100 transactions on average per card are concluded annually.
The United Kingdom
The UK registered the second place globally for e-commerce as a percentage of GDP following China. Interestingly, the British currently prefer taking out their phone or card to pay for even the most mundane daily purchases. The UK is forecast to transition at the very least to a predominantly cashless society as soon as mid-2020.
Australia is the seventh most ready country for the transition. “By 2022, the vast majority of the population should have at least one smartphone, while internet banking penetration is forecast to reach almost 70% of Australians.”
However, more alternative and digital payment methods are likely to be available to the average consumer once the open banking legislation comes into effect by around 2021.