Welcome to another week of financial learning. In my last article, I explained the numerous benefits of running a good record-keeping system. I linked the benefits of record-keeping and the financial discipline journey.

Today, I want to again examine the growing cashless systems in Ghana and their short and long terms impacts on financial discipline and independence.

For the benefit of my new readers, I would like to explain financial discipline again.

Financial discipline is the ability to spend and save within one’s income.

Financial discipline thus can be simplified as how well we conform our spending and savings to the plans that we have set to achieve our monetary goals.

The steps towards financial discipline have gone through many changes mostly with technology and globalization.

Changing taste and preferences have also affected the spending pattern of many people even in developing countries like Ghana.

Technology and globalization as hinted above have brought a reinvented system of cash movement in the world called the cashless system or society.

This system has become a part of the literate society in Ghana now. Cashless economy is being pushed by consumer preferences and technological advancements

Wikipedia defines cashless society as “an economic state whereby financial transactions are not conducted with money in the form of physical banknotes or coins, but rather through the transfer of digital information (usually an electronic representation of money) between the transacting parties.

It goes on to explain that cashless societies have existed from the time when human society came into existence, based on barter and other methods of exchange, and cashless transactions have also become possible in modern times using digital currencies such as bitcoin.”

Between 2008 and 2013, the estimated share of payments done by cashless methods in Singapore stood at 61%, 60% in the Netherland, 52% in the United and 45% in the United States of America.

The first African country to appear in the first 20 was South Africa with 6% of their total payments done by cashless methods.

The cashless system in plain language simply means a system where people buy and sell without physical cash.

I will look at the various forms of cashless systems in Ghana and its impact on spending and savings within your means i.e. financial discipline.

Cashless systems have many benefits that we need to know. The following are some of the benefits of operating a cashless system;

  1. Convenience-Purchases are now made from ones’ comfort without having to move from one destination to another
  2. Helps in tracking ones’ spending pattern
  3. It offers relatively lower risk than carrying cash around
  4. It offers quick transactional access

There are however some drawbacks with cashless payment systems.

The first and obvious disadvantage has to do with security. Manoj Nagpal, CEO, Outlook Asia Capital had this to say concerning the risk involved with cashless systems, “The biggest fear is the risk of identity theft.

Since we are culturally not attuned to digital transactions, even well-educated people run the risk of falling into phishing traps,”.

The second drawback with the cashless system is the tendency to overspend.

According to behavioral finance theorists, the pain of parting with money is felt more acutely if you use physical cash instead of a card.

Hence, using cash instead of cards or mobile wallet acts as a natural bulwark for people who find it difficult to control their spending.

How many people can relate to this finding by the behavioral finance theorist?

From the above pointers, we can clearly see how financial discipline is affected or supported by a cashless system.

With our Ghanaian setting in focus, I want to look at three main cashless systems that propel or work against our journey towards financial discipline.

The three major systems are;



Investopedia defines a bankcard as any card issued against a depository account, such as an ATM card or a debit card.

The popular bankcards in Ghana are debit MasterCard and Visa Cards, Prepaid MasterCard and Visa Card, Ghlink cards and recently Credit cards for some prestigious clients.

These cards offer convenience to withdrawals from the financial institutions’ ATM machines.

They also offer holders the ability to make over the counter payments at shopping malls with the use of Point of Sales (POS) devices as well as paying for items online.

Transfers that hitherto were done through banks are now made through bankcards from the comfort of homes.

To make transactions more secure for customers, the vendors of these cards have encrypted advanced secured features.

The growth within this space has been great for many banks. It will only get greater and better with technological advancement.

In advanced countries, Contactless credit cards, such as the ones provided by Visa and MasterCard, are growing increasingly popular with consumers.

These allow credit card transactions to be completed instantly simply by scanning the card, rather than the cumbersome method of swiping it in a reader.

Again, this has reduced the amount of physical cash moving about in the major cities of the country.

The financial institutions still have a lot of work to do about public education.


The second growing cashless method is the use of Internet banking.

Internet banking offers online access to your account, and the ability to transfer money or perform other tasks with a few clicks of your cursor or taps on your phone screen.

Again, just like the card system, internet banking offers convenience.

You can process transactions at any time, meaning that you will not need to interrupt your work schedule to take a trip to the bank.

It acts as a substitute for paying fees and bills directly with cash. Such payments can be made with the click of a button.


This is perhaps the common cashless method in Ghana now. This method has now reduced the “lies” for not supporting others financially.

I am sure you are asking how? Back in the day, one had to visit his uncle for financial support. Do we need to do that now?

We used to say that no financial institution was closer to our location hence, deferred financial support.

All you need to do is to ask for help and provide your Momo line. Life has been made easier now for everyone.

Almost all shops at the major malls in the country have dedicated mobile wallet lines for customers who do not want to pay with physical cash.

Some churches prefer Momo offering and tithe payments to the receipt of cash.

The good thing about this method is that it works across the whole country.

Mobile works at Walewale, Sunyani, Asante Bekwai, Osu, Hohoe, Axim, etc. The whole country is one with mobile wallet payments.

This is good news for convenience purposes.

Financial institutions have now linked mobile wallets to bank accounts.

An emergency visit to the hospital has become a bit simpler as payments can be made from ones’ bank account to his wallet against running to an ATM machine.

Life is good now!

However, how do these convenient cashless methods affect our journey towards financial discipline?

The first thing we need to understand is that cashless systems as already explained help us to track our spending with proper record keeping.

We can always go back to know exactly how we spent our income in a particular month. This offers us an opportunity to correct reckless spending.

It also helps us stick to our personal budgets since everything is electronic now.

This same system can also breed irresponsible spending if we are not disciplined.

In the past, the thought of picking a car to the bank to withdraw an amount of say GHS 50 discouraged many people to manage whatever funds they had on themselves.

That is not the case now!

We overspend and buy things without a budget just because we have access to our funds 24/7. As a savings tutor, I will advise that you locate your weakness.

If you are spendthrift, then obviously, going to the market with an ATM Card will not be a good idea.

Learn to use all your cashless platforms well with the mindset of financial discipline. Being financially disciplined is not an option but THE OPTION!!

I wish everyone a wonderful and memorable week!


NB: Article image from Indiatoday

Patrick Baah is a chartered banker with over 5 years experience in main stream banking having worked in various capacities. He is currently at the Branch Manager Position of his institution. He has been a qualified member of the Chartered Institute of Bankers, Ghana with a good membership standing since the year 2013. He also holds EMBA and BA from Kwame Nkrumah University of Science, Technology, and the University of Ghana respectively. Patrick is the originator of the daily epistle dubbed “Savings Tip of the Day” which has been running for over a year on WhatsApp and Facebook. Patrick has also been teaching on the Topics Savings, Investment and Financial Independence for over 2 years and a research fellow for ILAPI Ghana. He runs a financial channel on Youtube by name “Patrick TV Gh” and has appeared a couple of times on the business segment of TV3 News 360. Patrick is into youth facilitation and counselling. I can be contacted via baasco2006@gmail.com and or 0243984492.


Please enter your comment!
Please enter your name here