I routinely ignore the frequent emails from my bank. If I want to know how much money I have I can check online or ask my wife. One of the many emails received weekly tells me how many ‘rewards’ I have earned on our reward account for using one of the several cards associated with the account. Usually, the amounts are trivial and on the few occasions I do check I am directed to the possibility of spending it on something I don’t want. But the other day the email header told me that I had over £800 of rewards to claim. I assumed the email was a scam, but the email address checked out and I called my financial adviser (aka Mrs Watson). ‘Don’t you just transfer the money into the account?’ she asked. Apparently, unbeknown to me, that’s what she does with hers. I had been under the impression that I had to spend the rewards. But after a few clicks on my iPad, and a full working day later, £800 miraculously appeared in our account. And if I use a card to spend this £800, I’ll get more rewards.
Where does this money come from? Beats me. It is not mine, as I did not have it sitting anywhere else. It could be someone else’s, but I think that would be classified as fraud or theft. So, I imagine that my bank has simply created it by pressing a few buttons. It cannot be real money. The pressure is clearly on us to use our cards as part of the inexorable move towards the cashless society, much derided recently by Peter Hitchens. The outcome, however small a contribution it makes, is inflation. My bank is not the only one offering reward accounts and if banks are creating money to accommodate their rewards systems the value of their holdings must be decreasing.
We have already covered the dangers of the cashless society in these pages and how the pandemic has been used as an excuse by our government to borrow unimaginable amounts of money. This will leave our children and grandchildren as hostages to the banks for decades ahead as money becomes steadily more expensive to borrow as interest rates go up and concomitantly of less worth as inflation continues to bite.
The leverage towards greater cashless spending and the interaction with the pandemic is obvious—an episode of James Delingpole’s podcast The Delingpod with Dan Tubb explores this in more depth—and contactless payments are another prime example. The pandemic had hardly been declared than the limit on contactless cards was increased from £30 to £45 in April 2020. Despite early reports indicating that the risk of catching COVID-19 from handling money was negligible, the evidence was ignored and many major businesses started refusing to handle cash. In October this year the limit for contactless spending is going to be increased to a staggering £100. This is ridiculous as anyone—like me—who has been hustled at a cashpoint will testify. The hustle involves someone on your left distracting you by asking if you have dropped your card. This happens at the precise point when your card is emerging from the machine. As you look round at that person, another person on the right whips your card and within minutes they have used the card up to the limit at a nearby shop. I lost £30; from October they will have access to £100.
Presumably the next increase in the contactless limit is timed to coincide with the proposed October ‘firebreak’ lockdown. If there is a global plan, it appears to be coming together nicely.
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