I had some time to think about what money and banking systems could look like in the future, and below are a few visions that I imagined.
Money has a very broad definition and serves quite a few purposes such as being a medium of exchange and standard of deferred payment, amongst others.
Let's deal with the first one that is the use of money as a medium of exchange. Money currently is exchanged in the form of currency notes as payment for goods and services. However it faces a few limitations in its current physical form. Currency in the form of paper notes can get damaged, soiled or stolen. That would cause you to lose value equivalent to the value of the money. Cheques and cards have some advantages when it comes to that, since they do not cause you to lose value in case of the above events.
However, I wonder, would it be possible to have disposable currency, that has meaning only when it is used for exchange ? What is we could activate and deactivate money to eliminate the chances of it being stolen or misused? Could it be that you could print out and tear paper at any time as per your convenience and use it as money when you need to? This might sound crazy and has a lot of practical difficulties in implementation , but it is worth imagining the convenience and security that it could bring us.
Transfer of money :
I imagine that it would be possible to implement a system that would make it easy for anybody to transfer cash to someone in anypart of the country without being physically present. This would unlock a lot of potential in terms of payment, and facilitiate a lot more business. It would be possible to send cash to a friend who is at an ATM in some part of the country from the comfort of your home or office without requiring cumbersome identification and the need to have a bank account in the same bank, or perhaps even a bank account at all. I can already imagine way of doing this with out adding too much complexity to the way banking is currently carried out and without adding too much work for the users.
Mobile money :
Steps are already being taken to enable and facilitate the use of mobile money but a lot more can be done. What if you could just be someone using a mobile device with / without an Internet or mobile network connection? What if bank accounts were tied to mobile numbers and you could just tap a mobile phone near by confirm that you want to pay and they would receive the money? What if everybody could do that, everybody from all walks of life doing all kinds of business, even those who do not currently from a part of the banking system.
Banks everywhere :
What if services were decentralised, so that you could withdraw and deposit money at any convenience store or supermarket (not just ATMs) ? Every service that banks provide could be broken down and added at convenient points, and you wouldn't need banks anymore.
Most ideas have arisen while thinking about "The Future of Banking" when mentoring the MIT ML Design and Innovation Workshop, Mumbai 2014. Most ideas are my own, but they might include interesting suggestions that I picked up from conversations with others.
Some thoughts might sound scary, impractical, crazy or anarchist. However, the above is just free imagination and does not completely involve practical considerations. It however does not however leave them out completely either.