China leads race to become world's top cashless society, says British expert

A staff member demonstrates the payment with China's digital yuan, or the e-CNY, during the first Global Digital Trade Expo in Hangzhou, east China's Zhejiang Province, Dec. 12, 2022. (Xinhua/Xu Yu)

In China, the proportion of the total amount of money in circulation in the form of cash has dropped to 3.7 percent and is continuing to fall, said Matthews.

LONDON, July 5 (Xinhua) -- China is on track to becoming the world's top country for cash-free transactions, Kent Matthews, professor of banking and finance at Cardiff University told Xinhua recently in an exclusive interview.

In China, the proportion of the total amount of money in circulation in the form of cash has dropped to 3.7 percent and is continuing to fall, said Matthews.

"People are using cash much less today than they were 10 or 20 years ago. The trend towards a cashless society is inexorable," he said, noting that today in Britain cash is about 2.9 percent of the total money in circulation.

In less than 20 years, China has, with impressive speed, closed the gap with Britain in terms of a cashless society, Matthews noted.

A staff member displays a mobile payment terminal for digital yuan (e-CNY) at the first China International Consumer Products Expo in Haikou, capital of south China's Hainan Province, May 8, 2021. (Xinhua/Guo Cheng)

This has shown how fast the technology of cash-free transactions and payment has moved in China and how quickly the Chinese society has accepted it, he said.

Matthews said he would not be surprised if, in the next five years, cash usage declines to less than 2 percent of the total money in circulation in China. "The adoption of technology in China is much more rapid."

Recalling how on a recent visit to China he used his phone to buy a mango from a street vendor for just a few pennies, Matthews said the technology in China is very advanced compared to other parts of the world, and that has to do with the digitization of its economy.

In China, Matthews was amazed to see people who he'd expected to prefer using cash, such as the elderly, small shop owners, and street vendors, used their phones for transactions rather than cash.

Photo taken on Sept. 4, 2022 shows e-CNY (digital yuan) payment cards at an exhibition of financial services during the 2022 China International Fair for Trade in Services (CIFTIS) at the Shougang Park in Beijing, capital of China. (Xinhua/Ju Huanzong)

"China is setting an example on digital payment to the rest of the world and is showing us that, in fact, age is not an impediment," he said.

However, he believes that no country can become totally cashless. "There will always be a need for cash, and it will be impossible for any government to legislate cash away," he added.