What happens to cash when you make an online purchase?

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When you buy something online or with a credit card, what happens to the physical money that the transaction represents? Are there just trucks of money being carted around to different banks? Does the number I see on my bank about even represent real, physical cash?

In: Economics

6 Answers

Anonymous 0 Comments

There is no physical money. Just the distribution of electronic 1s and 0s between the computers of financial institutions. In fact, over the last 10 years, the US Bureau of Engraving and Printing has printed fewer bills than in decades past because of the increase in purely electronic transactions.

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