The New Definition of Cash

I have to admit, I’m having a hard time believing this one.

According to a recent Western Union survey, 69 percent of American consumers are planning to give the gift of cash, check or a gift card to friends and family this holiday season. Furthermore, the survey revealed that 79 percent of consumers would prefer to receive a gift card this holiday season that could be used anywhere traditional credit cards are accepted.

Here’s what their press release said:

“Cash as a gift isn’t just practical; it’s an on-trend gift as well. According to the same Western Union survey, consumers are utilizing cash more often in their day-to-day finances, where in the past they may have relied on credit cards. Seventy eight percent of consumers find cash a smarter way to spend money. And, seventy seven percent of consumers also reported that using cash helps them stick to their budget, particularly useful when every penny counts.”

“Consumers are rediscovering the practicality and convenience of cash, and so it’s logical for an increased acceptance of cash as a gift during the holidays as well. And when it comes to sending cash, Western Union is the ‘gold’ standard,” said Jorge Consuegra, senior vice president U.S. product management for Western Union.

This sounds like a corporate attempt to create a self-fulfilling prophesy to me.

I also think we’re headed down a path where the use of debit cards and gift cards will be considered the same as “cash”, because it won’t carry the bad-boy reputation of credit cards. But it’s still plastic, and plastic is still different from cash. I’m willing to bet that a percentage of the respondents who plan to give someone a gift card this year feel that they are giving that someone “cash.” This might sound like I’m splitting hairs, but a swipe is still different that a clink. These cards are simply a tool being used to access cash – and they have associated fees attached to them that cost – yeah, cash.

On the other hand, a recent Boston Globe article indicated that a growing number of people are opening deposit accounts on behalf of others. Apparently, hundreds of consumers have already taken advantage of Citizens Bank on its “Gift of Savings’’ offer launched just a week ago, which features an extra $10 to people who open an account with at least $100 on behalf of a loved one. Service Credit Union here in New Hampshire opened at 5 a.m. on Black Friday with special deals like a three-month CD with 10% interest. The bank sold 2,224 CDs in three hours, about 20 times the normal daily volume.

So maybe Santa has an ATM on the North Pole after all….