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@RiteshA:

Countless articles have been written about why the success of M-PESA is unlikely to be replicated in too many parts of the world, not even in South Africa. Here's one from FT if you're interested: http://blogs.ft.com/beyond-brics/2012/05/28/mobile-money-kenya-good-india-bad/.  

The on-the-ground situation is no better: The same Vodafone that is involved in M-PESA in Kenya has tried launching its equivalent M-PAISA at least twice in India and has withdrawn it both times. And, let's not forget that M-PESA was launched as far back as 2007 and the lack of another example in these six years only proves the point.

So, I'm sorry if I'm not drunk on the Kool-Aid of TELCOs posing a threat to banks, a topic on which I'd written a separate blog post: 

Banks Have Nothing To Fear From TELCOs

The real change is the one you've described in your housing complex. I've seen a similar prepaid card initiative fold up in a neighboring housing complex a couple of years ago when the system went kaput and there was no money budgeted for AMC. But, that's no reason why the one in yours shouldn't be successful. 

@JayakumarV:

Up until recently, you couldn't book an eticket with cash. Now you can, as I've pointed out in my post.

Like you, even I like to pay by credit card - wherever I can. Unfortunately, it takes two to tango. So many merchants in so many parts of the world don't accept credit cards because they can't get a merchant account and / or find the MDF / MSC too expensive. According to iZettle, the number of such merchants is around 30M in Europe. That number could fall if MDF gets legislated down to 0.3% as EU is proposing to do. That said, hitherto card users could switch to cash if merchants start levying surcharge for accepting card payments as they're increasingly being permitted to do.

For every cardholder who loves spend analytics, I know at least one other who hates the loss of privacy inherent to the process of gathering spend data.

Lastly, cash is the most primal form of wealth and, although it could vary from one culture to another, I don't expect too many merchants to spurn wealth by refusing cash. 

So the scale could tip in the other direction as well.

For the kind of transactions I do with cash, it's the best, fastest, and the cheapest method of payment as on date. If credit card MSC / MDF gets legislated down to 0.3% as EU is proposing to do, then merchants might find cash costly but, at current interchange levels, I haven't come across a single merchant refusing cash as being too costly and welcoming noncash payments in its stead.

The 190 year figure hasn't come out of the hat. It's the outcome of a number crunching exercise that's based on hard facts and figures. While anything can happen in future - electricity could disappear, for example, as @FinextraM points out - but, based on what we know today, the 190 year figure can't be taken lightly.

Not sure what problem mobile money solves but PayPal, BitCoin and EFTs originated for reasons completely unconnected with imperfections in cash. In fact, cash is making a comeback in some of the usage scenarios that were the traditional forte of electronic payments, as I've highlighted in the example of e-ticket in my post.

@AndrewS:

I haven't made any comment about ROI of Starbucks card program. ROI of retailer closed-loop cards has never been in doubt - Starbucks is not the first, nor will it be the last, retailer to launch a closed-loop card. That said, I'm not sure if Starbucks has gotten any additional ROI from its mobile app that it didn't get with its plastic card. 

In my calculations of share of Starbucks mobile app compared to all other methods of payments accepted by the company, I've actually attributed 100% of all mobile wallet spend - not just majority - to the Starbucks app. So, there's no argument that Starbucks' mobile app is popular as mobile wallets go. Its popularity is only in question as a method of payment within the company.  

Multiple platform development, extra infra requirement, uncertain ROI compared to plastic - these are precisely some of the hurdles facing mainstream adoption of mobile wallets by merchants. So, excluding them and arriving at a 35% mobile wallet transaction share doesn't really say much and frankly sounds somewhat like "Ferrari has a high market share among people who want a Ferrari and can afford one". I doubt if the day will come in my lifetime when Starbucks will report 35% mobile wallet share of payments without any qualifications but I'm happy to be proved wrong.

@AlexanderP: Plastic cards - open and closed loop alike, from Starbucks and zillions of others - have been around for decades and there's no question that they're extremely popular. Given the title of this article, my comment is restricted to mobile wallet only. I've heard those same figures about money loaded into Starbucks mobile app but, frankly, I've found them to be obfuscatory: While computing the mobile app's popularity among Starbucks' customers in comparison to other modes of payment accepted by the company, revenue and # of transactions are the only two valid metrics, not deposits (either in absolute terms or in comparison with that held by so many banks). Going by revenues, Starbucks gets < US$ 500M via mobile app as against a total revenues of US$ 13.3B via all methods of payment combined. The ratio of these two numbers simply doesn't support the claim that 35% of instore payments happen via mobile app. In fact, according to this article, Starbucks card - by which I understand plastic + mobile wallet - accounts for 25% of the company's sales, so it's impossible for the mobile app alone to have a 35% share of instore transactions.

As mobile wallets go, the one from Starbucks is #1. However, among the various payment methods Starbucks accepts, its prepaid mobile app is hardly a success: According to my calculations here, it's used by only 1 out of 25 of its own customers. Mobile wallets not based on card schemes - in other words, closed loop mobile wallets - might save money for the merchant but I've never understood their value proposition for the customer who is used to getting deferred payments and rewards with card networks based open-loop card payments.

"Talk about the death of cash goes back thousands of years" as Ron Shevlin says in his article I've referenced in the first paragraph of my post and I agree. Seeing as I've no commercial interest in cash or noncash methods of payment, (1) Several ePayments and mPayments have entered the market in the past decade, but volume of cash in circulation has only increased in the recent years (2) I don't have a compelling reason to believe that "it's different this time" (3) While cash might be broken in a few ways, alternatives are not without issues of their own. 

It hardly matters what I'm smoking but I'm certainly not drunk on the Kool-Aid of mobile money or something else rendering cash obsolete anytime soon.

@BrettK: I read the article you've referenced. Not being an economist, I can't claim to understand much of it. But it seems that the frailties of fiat currencies afflict cash and mobile money equally. In other words, if it's crazy to expect USD banknotes to be around in 2200, it's no less crazy to expect USD based mobile money to be around by then.

No, if anything, the awful extravagance in the assumption is in the other direction. Like I've said, "Mainly because the movement between cash and noncash modes of payment is not as unidirectional as it is often made out to be". My prediction is not based on continuance of the status quo - I don't know which part of my line "Just as electronic fund transfers and card payments have been replacing cash in some facets of life, cash has also been edging out electronic payments in some others." is unclear. For all the hype around mobile money, their actual performance to date doesn't warrant expecting them to radically transform the payment landscape. Even the app from Starbucks - easily the most popular form of mobile money - is used by only 1 out of 25 of its customers (click here for my calculations). And, it's not as though mobile money is new - we've been hearing about it for years. 

Exact calculations for the 190 year figure can be found in the first paragraph. It's not a rounded up or down approximation.