The hurricanes that ravaged the Southeast in September brought a trail of destruction, uprooting lives and isolating communities from basic necessities.
It also revealed how recent advances in digital money movement can help ward off some of the horrors that follow disaster, quickly enabling financial new lifelines, but also calling attention to the work that still needs to be done to ensure continuity of banking and cash when it's needed the most.
"The one thing that we all need is access to funds," said Laura Keen, senior program manager on the U.S. team for GiveDirectly, a non-profit organization that disburses funds to people in dire need of money, often following a disaster.
GiveDirectly was among the group of fintechs, government agencies and banks that sprang into action after
The expansion of mobile technology has sparked a
As such, "money" has become about more than holding paper, or even a plastic card. Digital currencies, blockchains, cloud hosting, open banking and myriad other tools that were experimental or non-existent as recently as 10 years ago, are opening new worlds of interconnected finance as easy to engage as a click on a phone.
"The future is
Cash register
Cash, the most basic and traditional method of payment, is giving way to digital wallets, payment apps from fintechs and the introduction of new faster forms of processing such as
Global cash usage is at 80% of its 2019 level and is decreasing at 4% per year, according to McKinsey's 2024 global payments report, which was issued in October. Overall, the global payments industry processed 3.4 trillion payments totaling $1.8 quadrillion in value and $2.4 trillion in revenue for payment companies in 2023.
Payments revenue expanded at 7% annually from 2018 to 2023, slowing a bit to 5% per year between 2024 and 2028. That will generate $700 billion in new revenue, McKinsey said, noting payments represent 35% of the total revenue pool for banks, creating an impetus for banks to counter the encroachment of fintechs into the payments industry by embracing emerging digital forms of money.
The Capgemini World Payments Report for 2025, released in September, found that 77% of financial professionals said e-commerce growth is a key driver of the shift to non-cash transactions and other trends such as account-to-account payments and digital wallets. Sixty-five percent of payment executives say instant payments, or real-time transactions, are key to expanding access to digital commerce. Digital commerce is reliant on fintech or bank mobile wallets, or emerging digital assets such as
But the growth in digital payments, while dramatic, still leaves $26 trillion in payments still made in cash each year, McKinsey said, adding that presents a massive opportunity for digitization, but a challenging one as the transition will happen unevenly based on different groups and regions.
But that innovation comes with a threat, as traditional methods of accessing money and making payments decline, the financial system becomes more beholden to automated networks, and potentially more prone to
"If there's no electricity for a long period, that causes a problem," Keen said. "And a lot of the people that we serve are underbanked. That can also be a challenge for digital payments."
Changing tides
As part of its hurricane relief efforts, GiveDirectly sent more than $1 million to households that suffered during Helene and Hurricane Milton, using a dramatically different method than it used for a similar operation it conducted in 2017 during Hurricanes Maria and Harvey.
For those earlier storms, GiveDirectly deployed teams on the ground to locate recipients for prepaid cards that were handed out in person over several weeks. It more recently deployed an artificial intelligence tool and a partnership with payments firm Propel to spot areas with high concentrations of underserved populations and storm damage. The AI uses "before and after" images, paired with drilled-down Census demographic and economic data. Propel, which specializes in government disbursement apps, contributes its enrolled user base and app to invite users to register for funds without requiring paper documentation. Philanthropic organizations and people donate to PayDirectly, also using a digital app. The whole process took two to three days, Keen said.
To reach people who may not be in Propel's database, do not have smartphones or prefer older methods, GiveDirectly uses a scaled down version of its in-person and plastic prepaid card networks. "There is a tendency in some of the populations we serve to have a physical item in their hands. It's something tangible," Keen said.
Many payment choices
Since there is a variety of new payment methods that are diverse and changing rapidly, there is a mix of excitement and anxiety for consumers and businesses that have to figure out how the new ways to pay are changing the way money works on a basic level.
There are questions to be answered, such as when is it the right time to
"As with anything that involves user habits, it's hard to change," said Nelsen, global head of consumer payments. "One thing that is changing is using digital payments or e-commerce feels safer now than it did 20 years ago." What's also changed in the past 20 years is the availability of new authentication methods, or the maturation of existing methods like biometrics.
Visa recently introduced
The expansion of automated financial services can increase participation by consumers, businesses and within the technology community, Nelsen argues.
"There are a number of unbanked people," Nelsen said. "They may be young or just starting their first job. Creating a way for them to access digital money is a big way to get them into the financial system."
Is cash really going away?
The relationship between digital payments and the decline of cash is complicated. Cash is still heavily used in most of the world, and adoption of digital commerce varies greatly from one country to another.
There is about $ 1.8 trillion in cash in circulation globally, according to the Federal Reserve, which reports that is up from about $1 trillion in 2015. And the average amount of cash held by households at any given moment increased from $231 in 2016 to $491 in 2022, according to the Fed.
"Cash is very much out there," said Joe Myers, executive vice president of global banking for Diebold Nixdorf. Diebold Nixdorf has also noted an increase in stored value relationships in the past several years, and that ATM withdrawals are decreasing while deposits are on the rise.
In response to these trends and the overall cost of cash handling, Diebold Nixdorf in recent years has pushed what's called
In the U.K.,
Even in countries that are largely digital, like Sweden, there are laws that protect cash. Sweden recently mandated that 97.3% of the population has to live within 15.5 miles from a cash access point.
While ATMs are historically viewed as "cash machines," the migration toward digital banking and commerce is also washing over the ATM industry. Part of it is competitive necessity. There are fewer than 450,000 ATMs in the U.S, according to research from Capital One, adding ATMs in the U.S. have declined 4% in the past five years. "Fintechs, or non-banks, have a different motivation than regulations to protect cash. [Their goal] is to grow the depth and breadth of their base," NCR Atleos' Bregman said, adding most neobanks, if not all, offer one or more surcharge-free ATM options.
NCR Atleos was one of the two companies formed when
For businesses, managing cash continues to be costly and challenging not due to disruptive technology but due to changing infrastructure and supply chain elements, Bregman said.
Branch reductions, cashless branches, self-service branches, reduced night drops, and a challenging armored vehicle marketplace contribute to merchant challenges, he said.
"Our response to this challenge has been to begin to transform the ATM to facilitate cash management within the store where cash in transit is going anyway, reducing reliance on external bank infrastructure and supporting cash as an ecosystem within the store," Bregman said.
For example, NCR Atleos in August partnered with
The Chime collaboration is part of a strategy at NCR Atleos to expand partnerships that grow the company's network while attempting to maintain access to banking for consumers and businesses that have a declining number of branches available.
Thousands of the company's ATMs across the United States carry the digital or physical brand of fintech such as Varo, Chime, and others. "These firms have no infrastructure of their own but use ours to reach customers where they are and provide self-service options for physical transactions through a true utility banking offering," Bregman said.
Those same firms participate and seek out retail cash deposit solutions with firms such as Green Dot or Incomm.
"Access to cash in and out, where consumers live/work/travel is not a burden to be borne and muddled through but an opportunity to lead in compliance, grow wallet share and position, and absorb customers who the large banks deem less desirable due to a focus on wealth management," Bregman said.
Cutting cash to save
Cash is more expensive than digital payments. The cost of cash to the average banked consumer is about $124 per year, based on ATM fees, the risk of misplacing cash or having it stolen and other factors, according to Crone Consulting LLC, which studies payment and retail trends. For unbanked consumers, the cost is about $450 per year, driven by fees for check cashing, money orders and other services." Banking the unbanked would save them substantially," said Richard Crone. "This is a greenfield opportunity, especially for community banks and credit unions."
More of a problem for businesses is the lost Lifetime Customer Value (LCV) of cash customers. Merchants miss out on about $150 per customer per year because they can't capture contact details or enroll cash customers in loyalty programs, according to Crone.
And for governments, cash costs 1%-2% of GDP, or $10-$20 billion per $1 trillion in GDP, due to the "shadow economy" that cash can support. And there is also the cost of printing and handling money, which is $5-$15 billion per $1 trillion in GDP for currency management.
But for businesses, emphasizing digital payments over cash is often generational.
"There are a new generation of business owners that have grown up with cell phones. They are digital natives and when they start a business the argument for digital payments is a secondary concern," said Chris Staymates, chief innovation officer at Stax Payments.
Stax recently acquired Atlantic-Pacific Processing Systems (APPS), a merchant acquiring company that will enable Stax to expand its focus from enabling payments and digitizing the point of sale to adding more payment processing functions and merchant products. The move is designed to diversify Stax's revenue as, like most payment companies, it faces a market in which payments — cash or otherwise — is less of a differentiator. For these companies, such as Stripe, PayPal, Block and the card networks, offering a range of services has become a currency of its own. And gaining buy-in from established businesses can be a challenge. Older business owners are less accustomed to digital payments as consumers, and are more concerned about augmenting cash with a digital option, Staymates said.
"One objection is the cost of digital acceptance," Staymates said, referring to the fees that fintechs charge to process payments on behalf of merchants–often more than interchange fees for card swipes at the point of sale. "Many merchants have an aversion to a company coming in and taking 2.5% or more of the transaction's cost." Stax, which was founded in 2014 as Fattmerchant, attempts to offset this concern by charging a subscription fee rather than charging merchants a fee for each payment.
But there are also costs associated with cash for merchants, according to Staymates, noting the fees for armored cars and the security risks, such as multiple people manually handling paper money between payments and deposits.
"The retention rates are higher for digital payments," Crone said. "You can enroll them in your loyalty program and they become a referral and you have word-of-mouth advertising which will increase selling and selling."
It's rapidly getting easier to migrate away from cash while still making people comfortable with making payments in unfamiliar ways, Visa's Nelsen said, adding that it also makes it easier for banks to introduce new ways to access funds. For example, the growth of generative AI and similar advanced forms of machine learning can help bank staff reach consumers, enroll them and produce a virtual or physical card in a few steps. It's similar to how Keen and her staff at GiveDirectly use AI to crunch census data and a sequence of images to cut the time needed to issue a recovery payment from two weeks down to two days.
"Generative AI will make a big difference," Nelsen said. "It's an answer to 'how do you do a quick verification'? What data can you access immediately? Ten years ago you couldn't apply for a bank account instantly like this. You can do so seamlessly now. It's pretty much up to consumers to decide what they want to use now, but there are going to be multiple channels available to them."
