From Sydney to Singapore, Cash Shines When Networks Fail

calendar iconNov 27, 2023

Millions of Australians were affected by a 14-hour network outage this month, with businesses reliant upon cashless payments losing a full day of income. Similar problems in Japan and Singapore underscore the importance of physical money when networks fail, and the need to avoid ‘cashless societies’.

Guardian Australia reports Australian telecoms company Optus was conducting ‘a routine software upgrade’ when information passing through their network exceeded safety levels and ultimately knocked it offline. Communications Minister Michelle Rowland said ‘the impact was felt across the economy,’ and ‘for some small businesses, it represented a whole day’s trade.’

The Conversation notes in its article titled ‘Cash may no longer be king, but the Optus debacle shows it is still necessary’ that moves towards a cashless economy may prove destabilising.

Going cashless is a form of privatising money. It moves transactions into a world where you must rely on banking institutions to buy and sell things while someone is making money off your financial dealings through fees... And as we saw all too vividly with the Optus debacle, a transition to privatised payment infrastructures opens up new kinds of vulnerability.
"Steven Vass, Business + Economy Editor, The Conversation

Days later, Kyodo News reports credit card transactions were disrupted across Japan on a busy Saturday evening, with Suica prepaid smart cards also affected. While cash is popular in Japan, with most locals carrying plenty with them to cover immediate expenses, some tourists were less fortunate, with a visitor from Taiwan finding himself unable to pay at a convenience store and noting ‘few currency exchange counters are open on a Saturday night.’

Shortly before these incidents, cashless payments suffered intermittent failures across Singapore, with Business Times reporting this was the fifth such issue for DBS Bank within the past two years. Citibank customers were also affected as people took to social news and discussion site Reddit to share confusion over some payment apps working while others were down. Reporter Yong Jun Yuan notes the ‘service disruption coincided with a backdrop of increased buzz over the resiliency of local digital banking.’

Cash is an essential complement to cashless payments. It offers unique benefits, such as the ability to pay offline and privately, while also serving as a valuable competitor to for-profit payment options such as credit cards. For individuals needing to transact while cashless payments are unavailable, for the businesses sustained by these payments and for the wider economy, cash is critical to stability.

Last Updated: Nov 27, 2023