Digital revolution has shifted the finance industry online and cash is no exception. Digital cash has become an important aspect of our daily lives with the exchange of cash using technologies such as smartphones, credit cards, and online cryptocurrency exchanges.
Digital money is accounted for and transferred using online systems. A common type of digital money is already present in society today in the form of cash held in online bank accounts. There are several advantages to using digital cash. Firstly, the cost of using digital cash is extremely low, as the infrastructure cost is cut down. Another advantage is long distance transactions become easy and less expensive.
With physical cash, sending money to the other side of the world can be expensive. This is also the case with electronic cash, since intermediaries get involved and hence have to be paid a fee. However, digital cash can be sent around the world without too much of a hassle.
Digital money is a major innovation in financial technology. It overcomes the problems of cash and makes payment systems faster and cheaper. But it has the attendant problems of technology, as digital money can be hacked and can erode privacy. While it is still early days for digital money, it will play a significant role in the future of finance.