#470
Cash Is No Longer King

What do bank robberies and tax evasion have in common? Other than the most logical crime-related responses, both are more common in cash-based societies.

Denmark is case in point – or rather, a lack thereof. As the country shifted away from offering cash services in branches, the number of bank robberies fell to zero last year. That’s not to say these criminals are unemployed though – just as with any industry, they’ll need to adapt their tech skills to keep up with the broader workforce amid the rise of internet banking and cyber fraud.

Meanwhile, other countries are still susceptible to more traditional approaches. Americans have exercised their stubbornness once again in refusing to shift away from their affinity for cash. Unlike Denmark, the US saw a rise in bank robberies, burglaries, and attacks on armored cars last year.

In many cases though, governments have their own agendas. As witnessed in Italy, Prime Minister Giorgia Meloni attempted to stand with small businesses and allow them to reject digital payment methods for transactions under €60, although this was ultimately reversed after pressure from the European Commission to honor their pledge to fight tax evasion. Facing a shortfall of €100b per year in taxes and social contributions, the benefits of shifting to digital are tough to dispute.

Nigeria is making a push to fight fraud as well, announcing this week that any cash withdrawal from government accounts would trigger money laundering investigations, in an effort to curb the $2.4b withdrawn from public accounts since 2015, as well as the arbitrage between the country’s dual exchange rate regime.

Despite these changes, the days of financial crime are far from over, and the shift to digital will inevitably expose a host of new challenges to confront.