Reni Odetoyinbo was among the millions of Canadians affected by the nationwide outage of Rogers Communications on July 8.
Posted at 12:14 p.m.
In addition to losing access to her internet service, the 26-year-old content creator encountered banking problems when she tried to get groceries. Like several other retailers that day, the store she went to could only accept cash.
“I don’t really walk around with money on me, but luckily I had some that day,” she said.
Mme Odetoyinbo doesn’t usually keep a stash of cash at home either, except for a $100 bill she received as a gift.
However, since the Rogers outage, she plans to start keeping $100 cash in her wallet at all times, in addition to a few hundred dollars at home. And, since some banks have reported issues with their ATM services, Mme Odetoyinbo is also considering keeping some of its money with a traditional bank, with physical branches. Right now, his finances are scattered among digital banks with no fees.
“Those who were caught off guard with no money may now realize that we need to have a backup plan in place,” said Lisa Kramer, professor of finance at the University of Toronto Mississauga.
While it’s not recommended to liquidate part of your retirement savings to keep it under a mattress, saving a few hundred dollars, based on daily expenses, for emergencies is a good idea, points out Ms.me Kramer.
“One only has to think of an emergency where the telecommunications are cut or perhaps the electricity no longer circulates. We don’t have access to emergency services. What could one need to be able to manage in this kind of situation to support oneself for a few days? »
And, when withdrawing money, it is better to make sure you have small denominations, such as $5, $10 and $20, continues Mr.me Kramer, in case traders lack change in emergency situations where only cash can be used.
Reserve a few weeks
Mark Cleveland, a professor in the Department of Management and Organizational Studies at Western University, thinks more Canadians will start to keep more cash on hand, at least in the short term, due to the recent national grid outage.
He recommends people to have enough money for about a few weeks.
“I try to always have about $200 in my wallet for anything I might need,” says Cleveland. “I try to keep two to three times that in a safe place at home, just in case. »
“Abandoning cash altogether is very risky. »
Cleveland says he believes people’s trust in the digital payment system will wane, at least temporarily.
“If the power goes out or if there’s a run on the banks and they have to close for a few days, if there’s a cyberattack on a retailer or a financial institution […] or on a country’s internet system, from, for example, a hostile foreign government, the digital economy can be badly affected, but cash will still work. »
However, since many stores were not accepting cash during the pandemic, people might need to get back into the habit of making sure they have banknotes in their wallet.
There may also be different generational attitudes towards keeping cash. Those with a lower tolerance for unpredictability tend to be older consumers and are therefore more likely to carry cash.
Younger consumers, who engage in higher-risk activities and believe themselves to be more impervious to harm, are more likely to forgo cash and use Apple Pay and other digital payment methods, Mr. Cleveland. They grew up with technology and are less skeptical of it, so they may not value money as much as a safety backup.
For people looking to change the amount of money they keep at home, just keep your home insurance in mind, Ms.me Kramer.
“Home insurance often limits the amount of money covered by the policy,” she explains. To decide how much money to keep, it’s a good idea to check this limit. »
Even if it is obviously possible to keep an amount greater than that provided for by the insurance policy, it is simply necessary to understand that in the event of theft, only the amount specified in the policy will be covered.