Cash

In economics, cash is money in the physical form of currency, such as banknotes

and coins. In bookkeeping and finance, cash is current assets comprising currency or
currency equivalents that can be accessed immediately or near-immediately (as in
the case of money market accounts). Cash is seen either as areserve for payments, in
case of a structural or incidental negative cash flow or as a way to avoid a downturn
on financial markets.

A wad of United States currency Contents

1 Etymology
2 History
3 Cashless society
4 See also
5 References
6 Further reading

Etymology
The English word "cash" originally meant "money box", and later came to have a secondary meaning "money". This secondary usage
became the sole meaning in the 18th century. The word "cash" derives from the Middle French caisse ("money box"), which derives
from the Old Italian cassa, and ultimately from the Latin capsa ("box").[1][2] The root is not related to the colonial British word
"cash", which meant "Indian monetary system", and derived from theTamil kasu, Sanskrit karsha and Sinhalese kasi.[2]

"To cash", the verbalization of the noun means "to convert to cash", as in the expression "to cashcheque".
a

History
In Western Europe, after the Collapse of the Western Roman Empire, coins, silver
jewelry and hacksilver (silver objects hacked into pieces) were for centuries the only
form of money, until Venetian merchants started using silver bars for large
transactions in the early Middle Ages. In a separate development, Venetian
merchants started using paper bills, instructing their banker to make payments.
Similar marked silver bars were in use in lands where the Venetian merchants had
established representative offices. The Byzantine empire and several states in the
Balkan area and Kievan Rus also used marked silver bars for large payments. As the
world economy developed and silver supplies increased, in particular after the
Traditional holed Chinese coinage is
colonization of South America, coins became larger and a standard coin for
also known as Cash.
international payment developed from the 15th century: the Spanish and Spanish
colonial coin of 8 reales. Its counterpart in gold was the Venetian ducat.

Coin types would compete for markets. By conquering foreign markets, the issuing rulers would enjoy extra income from
seigniorage
(the difference between the value of the coin and the value of the metal the coin was made of). Successful coin types of high nobility
would be copied by lower nobility for seigniorage. Imitations were usually of a lower weight, undermining the popularity of the
original. As feudal states coalesced into kingdoms, imitation of silver types abated, but gold coins, in particular the gold ducat and the
gold florin were still issued as trade coins: coins without a fixed value, going by weight. Colonial powers also sought to take away
market share from Spain by issuing trade coin equivalents of silver Spanish coins, without much success.

In the early part of the 17th century, English East India Company coins were minted in England and shipped to the East. In England
over time the word Cash was adopted from Sanskrit karsa, a weight of gold or silver but akin to Old Persian karsha, unit
of weight (83.30 grams). East India Company coinage had both Urdu and English writing on it, to facilitate its use within trade. In
1671 the directors of The East India Company ordered a mint to be established at Bombay, known as Bombain. In 1677 this was
sanctioned by the Crown, the coins, having received royal sanction, were struck as silver Rupees; the inscription runs "The Rupee of
Bombaim", by authority of Charles II.

At about this time coins were also being produced for The East India Company at the Madras mint. The currency at The Companys
Bombay and Bengal administrative regions was the Rupee. At Madras, however, the Company's accounts were reckoned in
pagodas, fractions, fanams, faluce and cash. This system was maintained until 1818 when the rupee was adopted as the
unit of currency for the Company's operations, the relation between the two systems being 1 pagoda = 3-91 rupees and 1 rupee = 12
fanams.

Meanwhile, paper money had been developed. At first, it was thought of for emergency issues, hence were most popular in the
colonies of European powers. In the 18th century, important paper issues were made in colonies such as Ceylon and the bordering
colonies of Essequibo, Demerara and Berbice. John Law did pioneering work on banknotes with the Banque Royale. However, the
relation between money supply and inflation was still imperfectly understood and the bank went under, while its notes became
worthless when they were over-issued. The lessons learned were applied to the Bank of England, which played a crucial role in
financing Wellington's Peninsular war against French troops, hamstrung by a metallic Franc de Germinal.

The ability to create paper money made nation-states responsible for the management of inflation, through control of the money
supply. It also made a direct relation between the metal of the coin and its denomination superfluous. From 1816, coins generally
became token money, though some large silver and gold coins remained standard coins until 1927. The World War I saw standard
coins disappear to a very large extent. Afterwards, standard gold coins, mainly British sovereigns, would still be used in colonies and
less developed economies and silver Maria Theresa thalers dated 1780 would be struck as trade coins for countries in East Asia until
1946 and possibly later locally.

Cash has now become a very small part of the money supply. Its remaining role is to provide a form of currency storage and payment
for those who do not wish to take part in other systems, and make small payments conveniently and promptly, though this latter role
is being replaced more and more frequently by electronicpayment systems. Research has found that the demand for cash decreases as
[3]
debit card usage increases because merchants need to make less change for customer purchases.

Cash is increasing in circulation. The value of the United States dollar in circulation increased by 42% from 2007 to 2012.[4] The
value of Pound Sterling banknotes in circulation increased by 29% from 2008 to 2013.[5] The value of the euro in circulation
increased by 34% from August 2008 to August 2013 (2% of the increase was due to the adoption of euro in Slovakia 2009 and in
Estonia 2011).[6]

Cashless society
Cashless society is the idea that in the future cash will be redundancy having been replaced by electronic means of transfer. In the UK
[7]
it is now reported that 1 in 7 people no longer carries or use cash.

See also
Banknote counter Cash register
Banknote seal (China) Cash transfers
Cash and cash equivalents Petty cash
Cash management APPSC
 Rebate (marketing) (cashback)

References
1. "Cash" (https://www.merriam-webster.com/dictionary/cash). Merriam-Webster. Retrieved 2017-08-20.
2. "Cash" (http://www.etymonline.com/index.php?term=case). Online Etymology Dictionary. Retrieved 2017-08-20.
3. "Federal Reserve Bank of Chicago, ''Debit Card and Cash Usage: A Cross-Country Analysis'', March 2007"
(http://w
ww.chicagofed.org/digital_assets/publications/working_papers/2007/wp2007_04.pdf)(PDF). Retrieved 15 November
2013.
4. Williams, John. "Cash Is Dead! Long Live Cash!"(http://www.frbsf.org/our-district/about/annual-report/annual-report-
2012/2012-annual-report-essay-cash-is-dead-long-live-cash/). Federal Reserve Bank of San Francisco.
5. "Banknote Statistics" (http://www.bankofengland.co.uk/banknotes/Pages/about/stats.aspx). Bank of England.
6. "Banknotes and coins circulation"(http://www.ecb.europa.eu/stats/policy_and_exchange_rates/banknotes+coins/circ
ulation/html/index.en.html). European Central Bank.
7. Alex West (23 October 2016)."One in seven Brits no longer carries cash, as we become increasingly reliant on card
and smartphone payments"(https://www.thesun.co.uk/news/2034280/one-in-seven-brits-no-longer-carries-cash-as-
we-become-increasingly-reliant-on-card-and-smartphone-payments/) . thesun.co.uk. The Sun. Retrieved
12 November 2016.

Further reading
Clyn Davies - A History of Money From Ancient Times to the Present Day(University of Wales Press, 1994) ISBN 0-
7083-1351-5
Peter Spufford - How rarely did medieval merchants use coin?(Geldmuseum, Utrecht, 2008)ISBN 978-90-73882-
21-8

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