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Is cash a diminishing security concern?

Today's businesses have many security considerations, which are often related to recent developments within industries or technologies.

One security concern that has been around for centuries is the safe receipt, handling and transportation of cash, something that would seem as relevant today as it was 50 years ago.

However, innovations like contactless cards and electronic payment services have led to a decline in cash use.

Some have gone as far as to say that cash will be phased out in the UK within a decade, so does this mean it is a diminishing security issue for businesses?

'Out of the system'

Data from industry body the Payments Council showed that cashless payments in 2014 exceeded the use of notes and coins for the first time in the UK.

Consumers, businesses and financial organisations used cash for 48 per cent of all payments during the year, with electronic transactions making up the remaining 52 per cent.

Mark Barnett, the boss of MasterCard in the UK and Ireland, discussed this issue at the recent Money2020 conference in Copenhagen.

Speaking to Business Insider, he said he 'very much doubted' that UK consumers and businesses will still be using cash in 30 years' time, adding that having pockets full of coins will seem as old-fashioned "as carrying a pouch full of gold".

Mr Barnett pointed out that Britain is ahead of the rest of the world in this respect, with cash still accounting for 85 per cent of all transactions across the globe.

He continued: "I think in five years' time there'll be practically [no cash in the UK].

"There will be some, there might always be some. But in terms of the number of transactions, in five years' time the vast majority of the cash will be out of the system."

'A fundamental transition'

From a security perspective, businesses and organisations that currently view cash handling and management as one of their chief concerns have been advised against assuming that cash could be on its way out.

Speaking to Professional Security magazine, Mike Bowen, business development director for G4S Cash Solutions in the UK, said: "It would be a mistake to think cash is going anywhere quickly."

Mr Bowen was speaking after his company released a report signalling a "decade of change" for cash use across Europe.

While cash appears to be on the decline in the UK, the volume of cash transactions across all of Europe is rising, according to the G4S research.

However, the proportion of all payments made in cash has dropped, with 40 per cent of transactions across the EU now completed by card or via electronic systems.

Graham Levinsohn, G4S regional chief executive, said: "What we are experiencing is a fundamental transition in the use of cash across Europe.

"European consumers and businesses will continue to use cash as part of a multi-payment economy.  But we need to modernise how they can use it."

One of the ways the cash supply chain can be made more secure and efficient is by reducing fragmentation, with fewer transfers taking place along the way.

G4S pointed out that it is common for the same cash to be handled and counted multiple times as it moves between parties within a single supply chain, which raises security risks and also creates a cost burden for businesses and banks.

Posted by Julie Tucker

Image courtesy of iStock/IPGGutenbergUKLtd

 

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