The Inter Ledger Foundation (ILF), an organization building and advocating for an interoperable payments network, has released the first report of their three-part Future of Digital Finance Series, titled A Cashless Country and the Future of Banks–Consumer Perspectives. The first annual survey reveals that consumers are split on eliminating paper cash, with half (51%) of all respondents willing to abandon it entirely, and half (51%) of Gen Zers specifically citing privacy concerns as their reason for not giving it up yet.
The report also revealed that FDIC banks’ relative safety is overshadowed by both choice and convenience when it comes to consumer preferences, with only 56% of Gen Z aware that only traditional banks provide FDIC insurance–insuring up to $250,000 of their deposits–compared to 80% of Boomers. This uncovers both ingrained cash habits and a key misunderstanding of what makes a bank a bank, highlighting the potential loss of banks’ competitive advantage over increasingly prominent digital payments providers.
The Interledger Foundation’s three-part Future of Digital Finance Series explores the relationships between both consumers and businesses and the payment and finance ecosystem in the US. The first report in the series, A Cashless Country and the Future of Banks–Consumer Perspectives, reveals that the centrality of both cash as the standard currency and traditional banks as the vehicles for storing and moving money are shifting.
“Consumer’s willingness to move away from cash and the blurring lines between traditional banks and digital payments providers reveals the need for safe and affordable digital payments infrastructure across the US,” said Briana Marbury, President & CEO of the Interledger Foundation. “By paying attention to preferences, concerns and openness to change, it’s clear that there’s room in the market for open payments solutions that meet consumers’ evolving digital banking and payments needs.”
The reports are based on research conducted by market research firm Dynata, on behalf of the Interledger Foundation.
The Interledger Foundation’s A Cashless Country and the Future of Banks–Consumer Perspectives report is based on responses from 1,004 consumers, ranging from 18 years old to age 60+, in all 50 US states.
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