Making payments through mobile devices is already a reality in today’s world and little by little this trend is expanding to the rest of the world. But will the use of electronic money really replace the use of cash?
Each time, technological advances allow for safer, faster and more efficient transactions, so in the near future, transactions can also be done from ATMs, the point of sale terminals or computers, also from portable devices such as cell phones.
Know More about The Electronic Money (E-money)
What is Electronic Money?
Electronic money is a virtual means to make payments without the need of a credit card or a bank account. Its objective is to facilitate the economic transactions of citizens.
In addition, its use is more secure than cash, since the user will no longer have to expose himself to theft. Another advantage of this new form of payment is that users do not need to have an account in a financial institution.
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However, there are still people who distrust the use of digital money, since what worries them most when paying on mobile platforms is that their data is vulnerable to hackers, in the opinion of the IEEE.
Today, insecurity is the main cause of concern for consumers to make purchases online, revealed by a study, adding that it is necessary for companies to use means that protect the seller and the buyer.
Payment through a Mobile Device
Nowadays it is already possible to make payments through mobile devices but only in some countries that have highly advanced technologies. While in countries with low levels of development, it is more problematic and delayed.
You already have the means and technology to make payments through mobile devices, so that the physical money will be used less and less.
Such is the case of Denmark, a country where its Central Bank stopped making notes and coins since 2013 to invest in electronic systems. In the future, it is expected that they will stop using cash in several stores.
“One of the reasons to end the traditional payment method is that it leads to tax evasion, coupled with physical money is unhygienic”, said Mario Mello, CEO of PayPal Latin America.
Advantages of Electronic Money
- It is a voluntary transaction method.
- It is more efficient. It does not deteriorate and allows you to pay the exact price.
- It will allow making payments through cell phones without Internet or credit.
- It will not require an account in a financial institution to carry out transactions.
- Withdrawing the money at any time.
- It can be used to pay for public services.
- More secure than the use of cash.
- Control over operations and expenses made.
- No need to carry bills and cash to make transactions.
Disadvantages of Electronic Money
- A little bit of commission must be paid while using it.
- A power outage or any other improvisation in the system could cut off access to funds.
- It may be possible all the people don’t accept the method of payment.
- It may take some time to adapt and be accepted as a method of payment.
By 2030, cash and credit and debit cards will be replaced by payments through mobile devices, according to a study by the Institute of Electrical and Electronic Engineers (IEEE).
The advantages and disadvantages of using electronic money should be analyzed, where one of the advantages is that this system seeks to strengthen its economic system by providing it with modern tools. And greater access to the population since transactions in the economy will be streamlined and contribute to financial inclusion in the popular and solidarity sector.