News in Brief

Accessing Cash at ATMs with Bitcoin

In the UK a company called BitcoinPoint has acted to make owning and using bitcoins easier. They are collaborating with the independent ATM operator Cashzone, who run 16,000 ATMs across the UK.

BitcoinPoint want to make bitcoin a mass market product and know that registering on a crypto exchange can be a daunting task for people who are not tech-savvy. They have developed an app to allow people to buy and sell bitcoins through a network of easily accessible points of contact such as bureaux de change and newsagents, as well as online.

The deal with Cashzone is BitcoinPoint’s next step to make bitcoins accessible and attractive to a mass market. It allows people to turn their bitcoins into cash easily and conveniently. The bitcoin owner uses BitcoinPoint’s app to enter the amount required and scan a QR code. They then receive an SMS message with a PIN code to be entered at the ATM which then issues the cash. No card or bank membership is required.

BitcoinPoint’s commission is reported to be a fixed fee of £2.70 along with 3.99% of the value withdrawn. Although this convenience comes at a price, it could be argued that this does make bitcoins feel more tangible and ‘main street’ than they have done before now.

Australia Scraps Bill to Limit Cash Payments

The Currency (Restrictions on the Use of Cash) Bill 2019 has been stopped in the Australian Senate. The bill would have banned cash payments over $10,000, with a two-year jail sentence for law breakers. The government said the bill is being delayed while it prioritises its response to the COVID-19 pandemic.

Although the Bill was put forward to crack down on Australia’s ‘black economy’, it was unpopular with the Liberal and Green parties, some of whose MPs saw it as infringing civil liberties as well as forcing people into the banking system. The level of penalties were also felt to be disproportionate by some groups, including the Law Council of Australia. Australia’s Green Party put forward a dissenting report opposing the Bill for restricting people’s civil liberties.

It is possible the government may still bring the Bill back since it was adamant that it was the best way to fight the black economy. The task force that had put forward the Bill had made a qualitative estimate that up to $50 billion was lost to the black economy each year. This was based on a wide definition of what activities make up the black economy.

MAS Suggests Going Digital at the Lunar New Year

At the Lunar New Year, it is the custom in Singapore, as in many other countries in Asia, to give banknotes as a gift. The Monetary Authority of Singapore (MAS) and the Association of Banks in Singapore (ABS) would like people to consider a different approach, to give e-gifts instead. This is known as e-hong baos.

There are a number of advantages to doing this, in the view of MAS, including less queuing to get physical notes to give and reducing the carbon emissions generated producing new notes for each Lunar New Year, estimated to be about 330 tonnes currently.

The environmental benefit is estimated by MAS Assistant Managing Director, Finance, Risk & Currency, Mr Bernard Wee, to be the ‘equivalent to emissions from charging 5.7 million smart phones or one smart phone for every Singaporean resident for five days'. 

The option to give new physical notes, if that is what people prefer, remains. An online reservation system has been introduced. Apart from those aged 60 or over or those with disabilities, account holders at three of the major banks will need to make an appointment to collect their new notes. There will also be some pop-up ATMs with new notes from DBS bank. Customers of Maybank and Standard Chartered also have the option of pre-ordering and making a collection reservation.

E-hong baos is seen by MAS and ABS as part of a larger long-term shift towards e-gifting. MAS will give the fintech firm that creates the most innovative e-gifting solution special recognition at the Singapore FinTech Festival in November 2021.

New Global Cash Initiative

Currency Research and Enryo recently launched a global initiative, ‘Universal Access to Payments’ or UA2P, recognising the need to both understand such effects and to implement plans that will proactively address potential issues.

UA2P seeks to help further financial inclusion by providing access to new digital payment instruments, while ensuring that access to cash will not suffer as a consequence.

Dutch ATM Attack Problems Continue

In 2019 Dutch banks, faced by a series of attacks using explosives on ATMs, closed down the ATM network overnight. The latest development is explosives being put into the deposit mechanism used by small business users when they want to drop off takings quickly and receive a credit to their accounts. In a recent attack the explosives failed to detonate.

In response, Geldmaat, who run the network for the largest Dutch banks, has shut down temporarily the entire network of machines that use Sealbags, 500 machines. Geldmaat are said to be looking at stationing security guards at machines in order to stop future copycat attacks.

ICA Responds to the EC Cash Consultation

The International Currency Association (ICA), which represents most of the global currency sector, has responded to the European Commissions (EC) consultation on uniform round rules for cash payments. This also included thoughts on the discontinuation of 1 and 2 euro cent coins, which have already been dropped in some Eurosystem countries.

According to the ICA's press release, its key points were:

• The need to maintain all the current denomination notes and coins in order to safeguard the right of citizens to use cash.

• The importance of keeping 1 and 2 euro cent coins both as a strong cultural identifier with the euro and because of their role in developing the financial literacy of children.

• The importance of treating different forms of payment equally in order to guarantee true consumer choice. This entails not singling out one form of payment for rounding rules – in this case, cash, which would discriminate users of cash against those using another means of payment.

Jutta Buyse, ICA Director General, said: ‘the ICA believes that the future of payments, and of cash in particular, should be part of an ongoing societal dialogue and we commend the European Commission for consulting the public before considering to take initiatives that would affect the use of cash in the eurozone.’