Safeguards needed against impulsive spending

While going cashless may have merits, it also means that the physical act of checking whether one has the hard cash before committing to a transaction is no longer there.

The self-prompt of not spending money which one does not have is easily bypassed.

In the case of children, who are still learning impulse control (Pupils go cashless with smartwatches; Aug 17), it is a tug of war between instant gratification and the cognitive effort of saving with smartwatch apps.

One can say that limits and safeguards can be designed into the apps.

But this would place the control with technology and not the people, who need to have the volition to step on the brakes and develop financial prudence.

On the road to a cashless society, due attention should be paid to mitigating the lure of impulsive spending and the perils of financial mismanagement that come with the ease of spending by gesturing with mobile phones or smartwatches.

Safeguards, values and behavioural controls need to be developed alongside the technology.

More research needs to be done to profile personalities or at-risk groups that are more susceptible to the pitfalls of financial mismanagement.

The authorities and commercial entities should exercise social responsibility to educate and protect the at-risk groups before they come to grief and society pays a hefty price.

Lim Teck Koon

A version of this article appeared in the print edition of The Straits Times on September 04, 2017, with the headline 'Safeguards needed against impulsive spending'. Print Edition | Subscribe