Few would doubt that money makes the modern world go round. But does money have to be physical banknotes and coins? After all, money is ultimately nothing more than points in a score-keeping system for credits and debts maintained by the banking system – and cash is part of that score-keeping system: When banks hand out a hundred euros in cash, they debit the deposit account of the person withdrawing the cash by a hundred euros.
So why bother with cash, now that virtually everyone has mobile phones and debit cards? Would it not be far more efficient to scrap all that paper money and have a fully electronic payment system instead? A debate about this issue has been raging for many years now, especially in the Anglo-Saxon world. Now German economists have joined it with a vengeance, as if something had to happen immediately. Rolf Bofinger, one of the German government’s top economic advisers, told the “Spiegel” news weekly that banknotes and coins were “an anachronism,” which had to overcome – the sooner, the better. FULL REPORT