Our Thinking



The Fight Against Cash

The benefits of digitization are clear. Joining the formal economy and leaving cash behind provides meaningful benefits – to people, to merchants, to businesses, and to governments. But cash remains the world’s primary transaction method. Recognizing that cash is the key competitor to digitization changes the scope and approach to beating it.


We believe cash can be beat because:

The value of cash is overinflated: it is the world’s most used product, universally understood and accepted. But people’s connections to cash are often emotional, rather than rational- they prefer to use it even though it hides substantial costs. People would immediately benefit by switching to digital, but are hesitant in doing so.

Cash is expensive: paying in cash may seem free, but in fact, it is not. Using cash leaves no trail, denying access to competitive insurance, lending, savings and transaction services. Completing a transaction at distance often requires travel, taking time and costing money. Cash is vulnerable to theft, and creates costs related to security, transportation. For businesses, counting and reconciling cash is time consuming. Non-traditional intermediaries are notoriously expensive.

As a result, often, the poor pay the most to transact – which we believe is a fundamental human activity. This needs to change.



However, existing efforts have so far been unsuccessful at beating cash because:

Partial solutions for replacing cash are ineffective: Individual organizations face immense challenges to compete with cash, and products unable to offer value at scale – with all merchants, in all corners of a country – are not attractive to use. Merchants are unwilling to accept and manage services with limited use. As a result, very few products have been able to reach scale. For those that have, they have often done so by creating two parallel financial worlds – one for the banked and another for the unbanked – which does not model the real world where the banked and the unbanked transact on a daily basis.

People need value and incentives to change their behaviour. Complex solutions that work in limited situations cannot compete with cash. Businesses and governments need to reduce their acceptance of cash to incentivize digital use. Merchants need to understand the costs of managing cash and balance those against the cost of accepting digital in a fair market.  But to do so, scaled solutions must exist.

Negative experiences with digital payments creates distrust: With the limited success of over 270 digital payments initiatives, the unbanked have learned to be suspicious of negative experiences. Among the unbanked, bad experiences are shared a hundred-fold. Such experiences create huge barriers against subsequent efforts for inclusion as people are often unwilling to try again and again.


The key obstacle to financial inclusion isn’t technology. It’s cash. To compete, solutions must be simple and work at scale. If a customer has to think- even for a moment-  about whether or not the funds they want to use will be accepted, then it’s too complicated.

Over 270 programs have been launched in almost 100 countries, but few have been able to reach the scale necessary to change people’s behaviour away from cash. Successful implementations are few and far between.

Cash is the challenge to digitization and financial inclusion. This is a challenge we can help overcome.