As the power of big data and digital economics converge, institutions and governments will have unprecedented control over their citizens. Would you be worried if authorities could track every purchase you ever made, and then, using computer learning, they could unlock what that says about you as a person – how you will vote, your sexual orientation, the likelihood that you will commit a crime?
Well, too late, that technology already exists.
When you receive a notification from your bank for a purchase you wouldn’t ordinarily make, a computer algorithm has already weighed you up, assessed the nature of the purchase, what it was, where it was made, and the probability that it was made maliciously. It protects your finances, so you don’t think twice about it. But imagine if this same process was applied to bar purchases on a government blacklist, sugary foods, cigarettes, materials from a banned music group. At what point would you consider that your freedoms were being eroded. Consider the US governments enforcement of a ban on digital payments to WikiLeaks as a precedent of such demonstrations of power.
If you are to follow the logic of certain techno-financiers, the best thing for the economy of the future would be a singular digital payments system in a cashless utopia of infinite productivity. By controlling the means of exchange, the apparatus through which transactions are completed, one can control also who is permitted to use it, and at what cost to them personally, or even what they are allowed to transact. In addition, exclusion from a singular state-approved payments system, in a world with no cash alternative, could very well be a death sentence. Surprisingly, such ideas are being floated around in the realms where banking meets digitization.
“We look at the present through a rear-view mirror. We march backwards into the future.” Marshal McLuhan might have had a surreal tone about him, but he certainly gave us ample warning. He did not live to see Facebook, or web-based advertisements, or the digital payments ecosystem of today, and yet the man behind The Medium is the Message made clear that reducing people to data points was tantamount to erasing them as individuals.
Unfortunately, most people have had a credit score and an online bank account for some time now, and the amount of information that social media companies have on you is nauseating. It took people a few years to conclude that if something is free, then maybe you, the user, are the product. But somehow, they aren’t spotting the trend.
Along with the convenience of digital banking and contactless payments we have one enormous cause for concern: your digital financial record. As we spend digitally, our transactions are recorded and communicated on various sites, systems, and servers, creating a timeline of our behavior. Such an artifact is an end to privacy and a risk to personal freedoms.
As non-cash payments edge out transactions made with cash, many are calling for people to push the brakes on a cashless society. Sweden is a nation on the front line in this regard.
Cash transactions in Sweden constitute only 1.4 percent of the value of all payments, and the country is expected to become cashless by 2030. More than 900 of Sweden’s 1,600 bank branches no longer handle cash or take deposits. Swish, the brain-child of a group of national banks, is a digital payments system now used by about half the Swedish population in place of cash.
But what does this mean for the privacy and freedom of Swedish consumers?
With less cash, most of their individual spending habits are being digitally catalogued. This gives increasing power to those behind the digital payments space, the corporations and banks, who take privacy from their customers and use this to push them towards certain choices.
There are around 1 million people in Sweden, a tenth of the population, who are unable to take up digital payments, even as it becomes increasingly necessary to pay for public services, such as toilets, digitally. The elderly and the less technologically capable are finding that they rely more on other people to deal with their financial lives, whether this is paying for bills or simply buying something in a cash-free restaurant. This is damaging to the personal freedoms and independence of these groups, and furthermore, it can force them to live a less private life as they need to expose their personal data to other people.
The truth is that fintech and social media have already come for their first round of your identity, and they are hungry for seconds. If we are to avoid having our freedoms taken away by relinquishing yet more power to the state then cash is one of a handful of remaining life-lines, one that we let slip at our peril.
