“Serve incentivare l’utilizzo della moneta elettronica e, intanto, Regione Lombardia studia il progetto per l’introduzione di una moneta completare all’euro”. Questi i due concetti espressi da Andrea Gibelli, vice presidente e assessore all’Industria e Artigianato di Regione Lombardia, partecipando, a Palazzo Pirelli, alla presentazione di ‘No cash day: la giornata contro il denaro contante’, primo evento internazionale dedicato alla riduzione del denaro contante e alla promozione dei sistemi di pagamento elettronico. All’incontro hanno partecipato Renato Mannheimer, presidente Ipso, Stefano Calderano di Jusp, Dave Birch di Hiperion e Geronimo Emili, ideatore del ‘No Cash Day’. Nel corso dell’incontro è stato presentato anche un sondaggio sull’utilizzo della moneta contante.[From Gibelli: studiamo una moneta complementare « IL TALEBANO – blog diversamente padano]
So we got off to a great start with a speech by Andrea Gibelli, the Vice President of the Region of Lombardy, who is a strong supporter of the shift to electronic money, but the anchor for the day was some research done by Renato Mannheimer, well known in Italy as the President of ISPO, a public opinion polling organisation. I thought the results were quite surprising (although it should be noted that the respondents were internet users) since they show Italians to be surprisingly anti-cash.
- Almost all Italians have a payment card, but less than two-third use it “frequently”.
- Regardless of usage, four-fifths are very much or fairly in favour of electronic payments.
- Four-fifth similarly think that e-payments should be stimulated to reduce the use of cash.
- Few understood the real costs or risks associated with cash. Cash costs the Italian economy around €10 billion per annum and the high use of cash there means that some 40% of all of the armed robberies in Europe take place in Italy.
One of the sponsors of the event was an Italian startup called “JUSP” who took the opportunity to launch their chip-and-PIN version of Square. It’s a card reader with a PINpad built-in with a set of attachments so that it can fit on iPhones and a variety of other smartphones and it’s just gone into beta. Looks fun, although whether consumers will be happy putting their PINs into a device not under their control remains to be seen.
When it was my turn to present, I talked about the technical, business and social drivers for change, focussing on the latter, and finished with three suggestions to change the situation. Since I wanted to focus on practical, short term steps, I suggested that
- Italy should lobby the European Central Bank to end the production of €100, €200 and €500 notes and the 1- and 2-cent coins. In 2012 there is no commercial need for either, and a rationalising of the currency is overdue.
- Businesses should be incentivised to support the shift to cash with a VAT discount for SMEs and micro-enterprises that have more than, say, three-quarters of their income in the form of electronic payments. Let’s get the taxi drivers taking contactless.
- Banks should be required to provide zero-interchange debit as a condition of their banking licence (this is because debit has the lowest total social cost of all payment types, so it should be the baseline and it is other payment types that should be charged for over and above debit).
Well, OK, I know that the first point isn’t that practical, or that short term, but we have to start somewhere and this is a reasonable point, shared not only among anti-cash extremists such as yours truly. Comparatively sensible people think this too.
For example authorities should be looking at reducing the number of denominations, eliminating change-only coins, improving durability and security and reviewing tax systems that result in receiving small change at every purchase.[From The Demise of Cash – More Radical Change Needed — Counting On Currency]
I have to say that there was (to me, at least) an unexpected turn at the event. Mr. Gibelli, as part of his very forward-looking talk about facilitating networking between consumers and businesses in the region, touched on the subject of alternative and community currencies, something I hadn’t expected to feature in the discussions (although I did touch on the topic in my talk because, as I noted here recently, the use of alternative currencies may be the most important long term impact of the transition to a mobile platform). He said that (or, at least, my interpretation of Google Translate’s version of his speech indicates that he said something approximating…)
The Lombardy Region has initiated a study for a complementary currency to the euro, which would benefit small and medium enterprises in a difficult economic situation… A Lombard complementary currency, already developed in both France and Germany, will be crucial for firms in Lombardy because it costs less, is cyclical and is not subject to interest.
Knowing that Mr. Gibelli was going to talk about complementary currencies, ISPO had added an additional question to their survey and this delivered yet more surprising results. Over half of the respondents knew what a complementary currency was (so they said) and almost two-thirds said that they would be happy to use one.
Later we went on to discuss the ways in which a local complementary currency might be used to stimulate economic activity within the rich network of SMEs (some 800,000+ of them) in the region. I should add that Mr. Gibelli represents the Lega Nord (the “Lombard League”), which favours (as I do) a more regionalist approach to Europe and has previously called for the North of Italy to secede from the republic to form the new country of Padania. I think they’ve toned it down a bit at the moment, but when the dragon banner flutters once again over an independent Wessex, I’m sure Padania will be one of its first partners in their post-EU free trade agreement.
All in all, I was surprised by the positive reaction to the idea of putting cashlessness on the agenda, although I strongly suspect that other regions may not feel as warm towards this shift as in Lombardy. But they should. Cashlessness will be good for Italy.
The prevalence of electronic transactions — and the digital trail they generate — also helps explain why Sweden has less of a problem with graft than countries with a stronger cash culture, such as Italy or Greece, says economics professor Friedrich Schneider of the Johannes Kepler University in Austria.[From Sweden: Country could be first to go cashless as even churches are accepting cards for offerings | Mail Online]
I make no comment on the culture in Italy—although I was told by an Italian that the worst tax evaders in Italy are doctors and dentists—except to note that the “tax gap” there has already reached billions of euros and is no longer sustainable. The problem is scarcely confined to Italy. It is apparently the case in the UK as well
More than 1,000 doctors and dentists are under investigation amid accusations they are guilty of tax evasion.[From More than 1,000 doctors and dentists targeted by HMRC over tax evasion – Telegraph]
Good luck to Geronimo Emili and the all of the gang at “No Cash Day”. Here’s looking forward to European “No Cash Day” in the not-too-distant future.
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