Everyone in my world knows that I am as old as Methuselah, except Waitrose . As I pass around the store zapping the barcode on my groceries , I know that the wine and beer , when I reach the pay station , will trigger a call for a human staff member to visually categorize my grey beard as ” licensed to drink alcohol ” . This petulant annoyance at a petty delay resurfaced in my mind while reading Dave Birch’s excellent new book , ” Identity is the New Money ” ( London Publishing Partnership ” Perspectives ” series , 2014 ISBN 978-1-907994-12-8 ) . This should be in the travel bag of every information marketplace manager this summer . It is the very best restatement I have seen of the arguments supporting the idea that the credit card is about to diminish in influence , and that as soon as it has been replaced by identity resting upon the smartphone mobile wallet , cash will rapidly follow it too . And that mobile wallet , an API generating activity , not an app , is fundamentally about our identity management and the way we express our identity . Birch’s thesis now has real credibility , and he is able to illustrate it with case studies from around the globe . His new world bears no resemblance to the things that he used to talk learnedly to me about 20 years ago . Then we speculated ( or he speculated and I listened !) about Mondex and its ilk . A whole generation of software never flowered – until the Smartphone , key change agent here as elsewhere , came along .
The classic of them all is now M-PESA , the cash-and-cardless system which has been so successful in Kenya . Run by the mobile phone operator Safaricom ( part owned by Vodaphone who are also the operators elsewhere in East Africa ) this has become the lifeline money transfer system for much of the region , a way of creating country-city transfers that branch banking could not effectively accomplish , and a way of establishing identity , and with it trust , where it was difficult , outside of village society , to establish it before . But , as Dave Birch makes clear , there will be losers as well as winners . The Mobile Wallet could well take banking out of payments – leaving banks simply as a part of the lending cycle ( and not the most lively there , either , if his comments on Zopa and its rivals are borne out in time) . And then what happens to credit rating in the transactional data slipstream of mobile wallet transactions . Our record will , so to speak , speak for itself . I have argued for a long time that the “big” data risk to credit rating is much greater than the opportunity – it exposes the low value-add of much of the current marketplace – but here I can see a real possibility that rating could become a mobile wallet application very easily indeed . He finds much to admire in PayPal’s increasing incursions into physical commerce , and joyfully lays into the idea that Bitcoin is the answer because of its anonymity . Indeed , like cash it has a degree of anonymity , but this comes about because the log of exchange only indicates ownership to an encrypted key . Anyway , cash seems to me more corrupt than not ( though I had to smile at his stories of adult services vendors in the US using Amazon gift cards as currency with complete anonymity – what a brave investigator this man is !) His insight however on the future of cash is surely sound – we will replace it with thousands of exchangeable objects that are useful or desirable to each individual : ” Here in London we already have the Brixton e-pound . The Local Exchange Trading Systems ( LETS) from physical communities and the platinum pieces and Facebook credits from virtual communities will surge and merge , forming a panoply of private currencies that will make trade more efficient . Why save dollars for your retirement when you can save kilowatt-hours or calories ?”
Even a selective and space – constrained discussion of the book demonstrates that there is much here for anyone who aspires to trade on the network – even if you are trading data or information . What is harder to convey is that this short book is densely packed with argument ; written , praise be , in English of a straightforward and intelligible sort ; has every technical concept explained , and has a breezy and enjoyable good humour that typifies the author himself . Small wonder that he is one of our most revered Telco and payment systems consultants . I can also add that when cash and the credit card follow the cheque into the network twilight , we shall not be publishing books like this at all, and it is no surprize to see how much of this came from Dave’s blog ( http://tomorrowstransactions.com ). And now I have to go – the car is on a parking meter and , having already used the parking app ( universal now in a London where meters are diminishing – since no one has cash enough) to increase my time allowance remotely I have now exhausted that allowance as well as my readers .keep looking »