Comment by frik | Hacker News Reader

Comment by frik | Hacker News Reader

Who is behind the recent cashless movement? Which group? Who wants to profit? The huge population who will be on the looser side, is evident.

It's not surprising that lesser educated people would find it convenient to not have cash. Though those don't understand what they would loose in the first place. Cash means freedom, no one can spy on what you spend your money on. And a big part of the money is still spend every day in the real world on location, and the smaller part online. Also cash cannot loose value as easily over night or even vanish without a trace (banks are private and can go bankrupt). It's very easy to keep track of your spending, when you use cash for all location payments (banks of course would like to loan you money). And remember, there was a time when banks were a new thing, and to catch consumers they provided bank accounts and services for free. Back then, you got your money from your employer in cash. Suddenly, employers started to pay out the money only to bank accounts you were locked in to the back system and of course they started to charge you for bank account and all their "services" incl ATM and cards.

The dominant explanation among leftist economists in Europe is that banks wants to set negative interest rates on consumer bank accounts. But that only works when cash is eliminated. Otherwise, negative interest would cause a bank run because keeping the money at home in cash is literally more profitable than leaving it in the bank account.

The interest rate is already de facto negative, 0% interest rate and fees on checking accounts. People still use them, because they value the convenience.

So basically, the protocol they use for monetary policy doesn't work, so they're trying to prevent deflation by eliminating cash.

Just replying to the last part -- I have two bank accounts, I don't pay any fees or charges whatsoever. Over here banks usually make the majority of profits from loans and mortgages, and investment fees. I suppose it makes sense to keep the daily banking charges to a minimum to ensure the happy customers will come to them with their financing needs.

My bank charges nothing for my accounts either. And I'm in Iowa.

Accounts are free, because the bank benefits from having your account in their ledger. They make loans and investments using that balance. Its the business they're in.

Banks benefit hugely when you use your credit card, they make money off the transactions. But also, they know that when you use your credit card you don't think about your purchase as much as when you use cash. With cash you watch it disappear, with a card its just some abstract numbers on a screen.

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