Will Digital Wallets Replace Cash?
The financial technology, or “fintech” revolution, isn’t just about new ways to borrow money. The popularity of digital wallets like Cash App, Venmo and Zelle is also rising for person-to-person transactions.
Julie Stackhouse, then-St. Louis Fed executive vice president over Supervision, discussed trends involving digital wallets during a 2019 Dialogue with the Fed event.
Stackhouse relayed a personal anecdote to the audience: She and her husband were debating what the future of cash would look like. So, over dinner, they asked younger members of the extended family, do you ever use cash? The answer was no; they used Venmo between friends and Zelle when transacting with their parents.
Stackhouse noted that some wallet vendors also have begun to issue physical payment cards tied to in-app accounts, and said that customers should be aware of potential security concerns when using digital wallets.
Stackhouse, now retired, has written extensively on fintech and other trends in banking for this blog.
- Dialogue with the Fed: How Fintech is Transforming Banking
- Open Vault: Digital Payments: The Ins and Outs of Money Transfers
- On the Economy: The Basics of Fintech