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Occasionally, I read a newspaper article or web posting where the author prophesies that digital payment systems will eventually dominate the economy, and cash (currency and coinage) will become obsolete.
Not so fast.
While the use of digital payment technology is widespread and growing, cash will remain an important backstop in times when digital payment systems fail. And they do fail. Unfortunately, power grids and communication networks aren’t as robust as we’d like to believe.
We know that severe weather events can knock out power grids, and software glitches can take down portions of the internet. Electronic payments won’t work when there is no power or no internet communication. Under those circumstances, cash is king.
Consider what happened in Texas in February, 2021. Winter storms dealt a blow to the Texas power grid leaving millions of homes and businesses without electricity for over two weeks. During the blackout, people were lined up in freezing temperatures to buy desperately needed groceries, fuel, propane, and other goods. Unfortunately, you couldn’t transact using a credit or debit card because merchant systems were down. But you could purchase whatever you needed with cash.
Spain suffered a power outage in June 2025 that caused widespread failures of digital payment systems. Businesses had to rely on cash transactions.
A software bug in CrowdStrike’s security software in July 2024 temporarily halted digital payment systems globally. Once again, you could only transact using cash during the outage.
During such crises, running to the ATM to get cash won’t help because ATMs are also down.
To protect yourself when digital payments are not possible, it behooves you to consider keeping some cash in safe places around the house where it’s readily available during an emergency.
We’re not talking about hiding a twenty dollar bill in your sock drawer. You’ll probably need at least a few hundred available dollars to get through a crisis.
Dennis Friedman, in his HumbleDollar posting “Comforts of Cash,” shared his thoughts about keeping cash available. He also offered additional arguments for having ready access to cash:
– If you shop at crafts fairs or flea markets, you may discover that some vendors are unable or unwilling to accept credit cards. Cash allows you to purchase the item that catches your eye.
– Some businesses offer discounts to patrons who pay in cash to avoid paying a merchant fee to a credit card company.
If you are concerned about privacy, you may chafe at the thought that every one of your digital transactions is recorded somewhere, subject to hacking by third parties. A cash transaction has the advantage of being anonymous. And no scammer can hack the cash in your pocket.
For those interested in pursuing this topic further, may I recommend the book The Power of Cash by Jay Zagorsky. Its subtitle: “Why Using Paper Money Is Good For You and Society.”
I like paying with cash at stores when I can. I don’t know why, but I do. Maybe it’s because I know deep down it is costing the merchant 3% or whatever for my card transaction, which is ultimately getting passed on to the customer. As for power outage situations, it seems that the pendulum has swung so far toward card use that businesses will be forced to make concessions to serve people when there’s no power. I don’t know what those concessions look like, but I can’t imagine a business letting everyone go without, say, bottled water because only 25% of the people have the cash available to purchase it.
Loved your article. Yes I believe it’s a little prudent to keep some cash on hand. Don’t think the Girl Scouts are taking credit cards at your door…but they might. Also I don’t think my grandkids would want grandpa giving them money via a credit card. I like the joke I made up. It goes like this; ‘I finally got some cash only to find out they only take credit.” Ain’t that just like life. I still like what Dave Ramsey says, “Cash is king”.
A lot of Girl Scout troops are taking credit cards now. Maybe not when going door-to-door, but when you see them at booth sales at grocery stores, etc.
Keep some can in your house. Problem solved. Then use your credit cards and online payments as usual