Use Cash for Privacy

 



In today’s modern society you can easily go throughout your week without the need to spend cash. Almost any place that you might choose to make a purchase will accept payment with either your credit or debit card. This may be convenient, but it also results in an almost total loss of your personal and financial privacy. Paying with a credit or debit card creates a record of your purchase, identifies the location where the purchase was made, and the date and time that you made the purchase. Anyone who is able to review your credit card and debit card statements can develop a pretty good idea of your daily routine, your likes and dislikes based on your purchases, and patterns and habits that are unique to your lifestyle.

According to the web-site Creditcards.com "Millions of credit card users receive monthly statements detailing their spending during the billing cycle: The standard information provided includes the date of a purchase, the place of the purchase, including the name of the merchant, city, state, amount of the purchase and a transaction reference number. Every transaction processed by the card networks (Visa and MasterCard) is assigned a merchant category code (MCC), a four-digit number that denotes the type of business providing a service or selling merchandise... the database's purchasing information can provide a pretty clear picture of credit card users. What do they know about you? Depending on how extensively you use your credit card, they conceivably have a very clear, distinct picture of an individual. It's not only your retail purchases, but your online purchases. It can really paint a very complete picture. The stores that you shop at can paint a picture. You also may use it at a doctor's office if you pay for care with a credit card. Some people pay for their utilities with credit cards."

 

Some merchants also want you to show an ID along with your credit card when making a purchase. This greatly increases your risk of identity theft, and according to the Department of Financial Institutions violates the policies of the major credit card issuers (i.e. Visa, MasterCard, Amex). You should never show ID when making a credit card purchase, but some unscrupulous merchants will demand that you do. Using cash to make your purchase eliminates this demand for ID, and lowers your risk of becoming a victim of identity theft.   

 

Cash purchases leave little or no record of the transaction that can be associated with you. Using cash will keep your purchases from being tracked by credit card companies, and sold to data brokers and marketing companies. Cash greatly reduces your risk of identity theft since there is generally no record made of your personal information when making a cash purchase.  According to the VPN company Private Internet Access "It’s not just privacy that requires cash or a cash equivalent. It’s also the ability to trade without having tons of red tape including a third processing party, which - to top it off - clearly establishes a merchant class (with the ability to receive money) and a consumer class (with the ability to pay and shut up). In contrast, cash has always been peer-to-peer."

It should be noted that in many countries, cash purchases are much more common than in the United States. For example, according to Dataversity, "In Germany 82% of transactions are made in cash compared to 46% in the U.S." 

 

Of course, using cash to make purchases on-line or pay debts to a non-local business isn’t really an option. There are options for making private electronic transactions which I will discuss in another blog post. But for any direct, in-person, purchase cash is king when it comes to privacy. It is also these in-person purchases that reveal the most about your daily life. So, to protect your personal and financial privacy, whenever possible - Always Spend Cash!