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Cash Around the World

December 16, 2010

I had the opportunity to visit some Asian countries recently, and of course needed to have some cash. Initially I thought I’ll just use my credit card everywhere, thats the way to go. It is the way for most things – hotel bill, fancy restaurants, higher end purchases. But I discovered, like here in the U.S., you need some “walkin’ around money”, cash of course! Short taxi rides, a coffee or soda while out, a quick lunch.

Cash usage around the world seems to be the same everywhere – larger purchases are handled with alternative payment mechanisms – credit/debit card, check, but the under $20 transaction is still cash. Thats where the volume is. The world economies consist of an awful lot of coffees and sodas and lunches and socks. Outdoor markets. Cash is faster and flows with less friction.

It’s also interesting to note that many countries are perfectly comfortable with rounding cash up and down, unlike the U.S. where we seem to hate pennies but everyone feels compelled to wait for their one penny in change, or the cashier demanding that last cent. The “penny cup” is our way to balance the transaction so we still see the penny, even if we leave it behind. Other places aren’t so particular about those pennies. when something is 3.98 they take the 4.00 and expect you to walk away. If it’s 4.02 they take the 4.00 and get on to the next customer. Maybe we should try that in the U.S. Abe Lincoln was a nice enough guy, but maybe it’s time to give him a break from posing for all those pennies.

~Bob Walters

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