Inequalities are compounded by lack of universal access to digital money, says Brookings white paper

Inequalities are compounded by the lack of universal access to digital money: all forms of money are processed digitally: cards, electronic and digital money, said Aaron Klein, principal researcher in economic studies at the Brookings Institution, in a new white paper.

“Policymakers need to find a way for everyone to have low cost / free access to digital currency,” said Klein, former deputy assistant secretary for economic policy at the Treasury Department and former chief economist at the Senate Banking Commission.

He predicted that the lack of access of low-income Americans to digital money will likely exacerbate existing inequalities and hamper the adoption of some new technologies for low-income people, especially in healthcare due to of its role as an obstacle to access to new technologies, in particular in an application. / mobile / online economy.

He said the health of those who are now too poor to have digital money could be compromised as this would hamper responses to new pandemics and a host of new technologies designed to improve health could require immediate access to health care. digital payments, including digital and online health platforms or services that are not implemented by Medicare but are rather direct payment models.

“Even though they are run by insurance but require immediate digital payment (as opposed to subsequent direct billing), they could cause uneven adoption issues due to the digital payment divide,” he said. he noted.

The lack of digital money for low-income families can be particularly acute for children, Klein pointed out.

Highlighting the government’s inability to provide fast and cheap digital payments as part of relief from the Covid-19 pandemic, he said up to 20% of eligible families had not received the first month’s payment directly deposited into their bank account.

“The response to the pandemic has underscored the importance of time to reach people with critical needs,” Klein argued; “Hungry children cannot be fed by mailed check promises.”

He said it can be costly for the 70% of people who use check machines and have bank accounts who don’t have digital money:

“Typically, bank accounts deposit checks at no direct charge, while check tellers charge significantly higher fees. However, banks can take several days for a consumer to access their funds, while check tellers provide the money immediately. The adage “time is money” is especially true for people living paycheck to paycheck. “