THERE has been a lot of talk in recent months about “infrastructure”: how much is needed, how much it will cost, who should pay for it, who should own it, where it should be located.

One of the few things that seems to keep this wrangling off the front pages is the spate of armed robberies of cash. But therein lies a bigger infrastructure story.

When it comes to electronic payments there is no infrastructure deficit. The problem is that sufficient numbers of people aren’t using this system and there is little inclination for this to change.

As a developed nation Ireland has the capability to be among the most technically advanced countries in the world. We aspire to be leaders in the e-economy and there is justifiable pride in being “up there” with the big boys in those league tables highlighting “best places to do business”.

When it comes to payment behaviour, however, we are closer to the third world than first. It’s still largely all paper — cheques and cash — and the consequence of that costs the Irish economy in excess of €500m every year.

That’s a huge sum taken up by the cost of manual transactions that could be done online, for cash withdrawals when a payment card could be used, for staff time eaten away by manual processes that can be automated, and for payments delayed “in the post”.

The list goes on and that is before we factor in the cost of security for the protection of cash in transit and investigating cash robbery. All this is quite apart from the non-economic impacts on those affected by crime.

Together this represents an irrecoverable cost to Ireland as a place to live and to do business. It may not be as clearly visible as physical infrastructure issues such as roads and airport terminals, but it is just as damaging in terms of our national competitiveness.

Consider the impact on society of making those savings. Firstly, it would immediately lower the cost of doing business. That in turn could open the door for investment in more productive use of resources — new initiatives or further employment — leading to lower costs to the consumer in a competitive environment.

There is also a potentially huge dividend to the public purse. Apart from the lower cost to government of making payments, there will also be the indirect contribution that it will receive from the reinvestment by business and society of their cost savings. No doubt there are many ways to spend such a dividend.

On the face of it, this is a win-win situation, so what can be done about it? For some time now it has been a specific policy objective of the Irish Payment Services Organisation to promote electronic payment but it is altogether too simplistic to position it as merely a banking issue. It requires input and action from a wider range of stakeholders, from government through to the consumer, all of whom currently incur unnecessary costs and stand to reap a reward.

Realistically, cash will continue to exist for the foreseeable future; practically, do we need to have as much of it around? As a nation, we seem capable of handling bigger problems. Yet this one is largely ignored because too many parties seem to want somebody else to take responsibility, both to make the change and to pay for it. It’s time to move on.

Stewart MacKinnon
chief executive, Irish Payments Services Organisation