Sound The Trumpet : Hong Kong to Become a Cashless Society?

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“Hong Kong to Become a Cashless Society?”
by Prophecy New Watch
September 18th, 2014

Could Hong Kong become the world’s first cashless society? The city has reportedly embraced the Octopus card, which uses a high-frequency (HF) radio frequency identification transponder that can be used for travel via subway, train, tram, bus, minibus and ferry. Almost everyone in Hong Kong uses the card, including the elderly. It can be used to pay for breakfast at McDonald's, to purchase a bottle of water at 7-Eleven, to buy snacks for the kids at a small shop, and to pay for parking at a municipal parking lot.

Such were the personal experiences and observations of RFID.com journal editor, Mark Roberti, on a recent family re-union trip to Hong Kong. His view is that the use of the RFID-enabled Octopus card is so prevalent that it is quickly replacing cash for many transactions. There are some additional impressive statistics reported from the Octopus Cards Ltd. website that seem to corroborate experiences during his trip:

• There are more than 25 million Octopus cards in circulation, which is three times the city's population.
• 99 percent of Hong Kong inhabitants, ages 15 to 64, possess an Octopus.
• More than 14,000 retail outlets accept Octopus
• There are now more than 67,000 Octopus readers throughout Hong Kong
• 13 million Octopus transactions amounting to roughly US$18 million are processed daily.

Roberti explains that the reason for the Octopus card's success is that five major transportation companies established a joint venture (known originally as Creative Star Ltd.). The system caught on quickly since the card could be employed for all types of transportation. And since everyone already had an Octopus card in their pockets, it made sense for minibus drivers and small shops to invest in readers and accept it as payment. Other applications of the card beyond payments include access to controlled buildings and parking garages. Other usages planned include the potential replacements of library and student cards by Octopus cards.

Unsurprisingly, the card also has some limitations. For one, it’s not used for large transactions since losing the card is like losing cash—the next person can use it. It's not meant to replace credit cards. And there are still a few forms of transportation, such as taxis, for which you can't use it.

In a subsequent edition of RFID.com, Roberti lists are some of the benefits that RFID-enabled transactions deliver:

1. Reduction in fare-collection costs: This is the big reason that transit authorities worldwide are introducing RFID payment systems. The cost of collecting cash from hundreds of fare-collection locations around a city is huge. RFID eliminates virtually all of this expense.

2. Reduction in turnstile maintenance costs: Mag-stripe cards are a big improvement over the old tokens used in New York and other cities, but mag-stripe card readers have mechanical parts that move the card from the insertion slot to the removal slot in most transit systems. These parts break and need to be repaired regularly. RFID readers have no moving parts, so they break less frequently.

3. Reduction in accounting time: Hong Kong retailers that accept the Octopus card greatly reduce the amount of employee labor spent counting cash and reconciling transactions. They can simply download a report of all their transactions, and the appropriate funds are then transferred electronically to their account.

4. Increase in spending: Studies show that sales increase when consumers can pay with a stored-value card. This is because people often forego small purchases when they do not have cash on them. With a stored-value card, however, there is usually money on the card to pay for a snack or other small purchase.

5. Reduction in the cost of producing coins and paper: Producing coins and paper notes that cannot be counterfeited is an expensive endeavor, and the average life span of a US$1 bill is just six years. Going electronic reduces the cost of producing physical currency.

6. Health benefits: Physical money is passed from one person to another, and has the potential to spread germs. Greatly reducing the amount of paper currency could reduce germ transmission.

In closing, Roberti rhetorically asks why with all of these great benefits, more cities aren’t yet following Hong Kong's lead and embracing RFID-enabled stored-value cards. No doubt the model will catch on and spread due to its great benefits and seemingly negligible shortcomings.

Whether the world’s next cashless society will start in Hong Kong or not, it’s clear that the entire world is technologically ready for the most part. It’s just a matter of time before paper money fades into insignificance to pave way for the ultimate in cost savings, security, identification and convenience across all spectra of society: biometric and RFID solutions.

Looking for His glorious appearing! Titus 2:13