Can cash still make you king in digital age? There’s pros and cons for you and businesses

LONDON — I arrived hungry but with some anxiety at The Yellow Bittern on Caledonian Road, not far from St. Pancras Station. The small restaurant — seating about 16 diners — had been open for less than a week. From the street it looked like a bookstore, befitting its name, which is taken from a three-century-old Irish poem. The place is run by Hugh Corcoran, the Belfast-born chef who’d made his reputation cooking in France and Spain. I wasn’t nervous about the food. I’d had his game stew and a sumptuous dish of tripe a year ago at a pop-up in Dalston. But there was a twist to this latest venture: The Yellow Bittern only takes cash.

As I looked at the chalkboard menu, I did arithmetic in my head to make sure the £100 I’d withdrawn from an ATM would cover me. While I’ve been to other cash-only restaurants, this was the first with expensive art on the wall (including what looked like a piece by the Scots painter Peter Doig, whose work has gone for millions at auction). What if I let my appetite get the better of me and ordered too much food and wine? I reluctantly averted my eyes from the sizable guinea fowl/wood pigeon pie and stuck to the Dublin coddle instead (sausage, bacon, potatoes, delicious).

There is one big advantage to doing business in cash: Restaurants don’t have to pay the fees imposed by credit-card companies for their services. You also have immediate access to funds if you keep the money close at hand. But there are disadvantages, too: The tax authorities are more likely to inflict audits on you; and word of cash on the premises may attract thieves. At The Yellow Bittern, you have to buzz to be let in. That’s a good precaution. But walking to banks to deposit envelopes of cash can also be hazardous. It all seems anachronistic in an age when finances can be zipped and zapped everywhere within seconds. I have my smartphone, so why should I even need cash in my wallet?

Over my solo lunch, though, it occurred to me that perhaps I’d taken to my cash-free habits too blithely. Why did cash feel archaic? In London, I use my phone to pay for almost everything, from rides on the bus and the tube to purchasing books and coffee and dinner. It’s been a rather recent and swift change in my behavior. Seven years ago, when I lived in New York, I made constant visits to ATMs to make sure I had enough cash to pay for the subway, taxis, snacks and after-work drinks.

The rest of the world hasn’t yet caught up to the U.K. and countries like Denmark (even in London, the traditional black cabs prefer cash, though they will grumblingly take electronic payment if you insist). You may consider Japan to be the nation of the future, but most of its consumers and shops still prefer to use cash at point-of-purchase.

Many people retain a fetishistic attachment to paper money. That’s because it is trust made visible — a certificate of value that governments and institutions promise to back up with their prestige and power (though not gold, which hasn’t been a currency standard anywhere in the world for decades). It’s not a contemporary virtue. Faith has been part of successful financial practice for centuries. The cross-border hawala system of middlemen in India and the Middle East — who parlay funds across hundreds, if not thousands, of miles — has been in place since at least the 14th century. As Time magazine’s news director, I used it to send money to reporters and staffers in post-Saddam Iraq because it was impossible to get a U.S. or Western bank to do so. It never failed me.

But institutions and powerful governments can deteriorate. The Chinese invented paper money centuries ago, but they also were aware that the underlying principle was delicate. Archaeologists continue to find jars full of coins stashed underground, apparently in preparation for the inevitable moment of dynastic decline, when rebellion, inflation corruption and upheaval would shake the empire’s authority — and the efficacy of paper. At the very least, the metal would retain a tincture of melt-down value.

That’s a lot to chew over with lunch. But there was more: A recent personal crisis involving trust emerged like a bad Proustian flashback. Last year, I foolishly believed a caller purporting to be from my bank warning me of an attempt to hack into my account. Alarmed, I followed his instructions, not suspecting the caller was in fact the scammer. After friends — at a restaurant — chided me for being too trusting, I discovered that tens of thousands of pounds from my savings had gone several ways across the world. My genuine bankers were sympathetic and, in time, restored my losses. But it took just moments of misplaced trust to vaporize my money into electronic signals that sped out of my possession. In contrast, I’d been mugged only once in New York — at gunpoint, which was terrifying — but the robber asked for my wallet only to remove whatever cash was in it, handing it back to me with my cards. I was shaken but only out $40.

I’m not saying that makes cash king — maybe just that I’m a fool with money, in any shape. I’m now spooked by the phone thieves rampant in central London.

Money is a complicated thing — and lunchtime meditations don’t come close to covering the way it permeates our lives. Its value depends on the willingness of you and me, as well as governments everywhere, to recognize it indeed has value. That is a scary circular argument — but we’re living it. Don’t let convenience lull you into complacency.

Oh, lunch came to £55. I left a £15 tip. I was so relieved to have enough cash.