To what extent is your object a product of globalisation, and to what extent has your object perpetuated globalisation?
Because the foreign exchange debit card can exchange currency across the globe it encourages the transnational consumption of foreign goods and services in such a way that it perpetuates globalisation. The foreign exchange debit card is a product that allows consumers to exchange currency at the market rate via a mobile app; from there, the card operates as a regular Visa debit card across the world. This essay will evaluate the foreign exchange debit card and its relationship to globalisation as both product and facilitator of. As such, this essay will consider globalisation to be the international integration of different people, cultures and goods and services. This process has occurred over the last twenty-odd years as a result of the growing importance of international trade and the rise of extremely powerful information technology. The foreign exchange debit card encapsulates what it means to be a product of globalisation, as it emerged out of a need for the quick and seamless exchange of currencies across the globe. Furthermore, the foreign exchange debit card successfully facilitates globalisation through encouraging international travel and trade in an unprecedented fashion.
The foreign exchange debit card is a strong example of a product of globalisation. This is because as the world has become increasingly interconnected over the last 25-odd years, international travel over holidays has become accessible to all of society’s economic classes. This has meant that more and more people need access to a wider range of currency to be used while holidaying. The first services that offered currency exchange materialised as physical booths (“bureau de change”) where a teller would offer the customer a rate on their domestic currency. The foreign exchange debit card is replacing this service for two reasons:
1. Innovations in technology, specifically mobile apps, allow services previously carried out by employees at a bureau de change to be replaced by an automated teller
2. Bureau de change’s are notorious for offering extortionate rates on currency, the foreign exchange debit card offers the market rate of the currency as it is traded on the foreign exchange market.
The foreign exchange debit card exists solely out of need for easy access to different currencies to be used while travelling. Travel is an inexorable component of globalisation, and as such, it can be said that the foreign exchange debit card is a direct product of a globalised world.
However, while the argument suggesting the foreign exchange card is a direct product of globalisation is convincing, there is a response to this that suggest the foreign exchange debit card is in fact merely an upgrade to a service which already existed. Essentially, since the foreign exchange card is an innovation within the pre-existing industry of foreign currency exchange, it is not in itself a direct product of globalisation. The act of valuing different currencies against one another and then offering a service to exchange said currencies existed long before the foreign exchange debit card, for example, in the form of the aforementioned bureau de change’s. Because of this, it can be said that the foreign exchange debit card does not establish itself as a standalone, direct product of globalisation as it merely takes the physical bureau de change and makes it mobile (via a mobile application).
On the other hand, even if one accepts that the foreign exchange debit card is indeed an innovation on a pre-existing industry, it can be argued that this is not damaging to the credibility of the card as its own standalone product of globalisation. This is because the extent to which the product changes the industry is of a sufficient magnitude to warrant the title of standalone. This is because prior to the existence of the foreign exchange debit card, access to foreign currency was dependent on one’s physical location, and now, the product allows anyone to exchange currency anywhere. In the same way a mobile telephone is an innovation to the pre-existing industry of telecommunications, the extent to which it revolutionised the industry allows the two (mobile and landline) to be viewed as two entirely separate products. This example applies to the foreign exchange debit card as the service is sufficiently transformative to the industry (in access, but also consumer base) that it is reasonable to state that it is indeed a direct, standalone product of globalisation.
In addition to being a product of globalisation, it can be argued that the foreign exchange debit card also perpetuates further globalisation. The foreign exchange debit card lowers the cost of currency exchange to regular consumers across the globe. Prior to its conception, only banks and brokers could access the market rate of exchange for a currency via the various over-the-counter exchanges around the world. Now, anyone with a smartphone can download a mobile app and exchange their funds at the same market rate offered to banks. This facilitates globalisation as it encourages more international trade as consumers have more currency to spend when they go abroad. International trade facilitates globalisation as it mixes products from different cultures and communities, increasing the global integration that is so important to globalisation. For example, when I travelled to the USA from my home in London in October 2016, my father helped me set up my foreign exchange debit card. The card offered me an extra $100 over what my domestic bank offered me for the same amount of cash in pound sterling. This allowed me to spend more money on souvenirs, food, sports tickets, and museum trips during my travels in New York and Los Angeles. As a result of having access to this extra cash, I was better immersed in this new culture and garnered a better understanding of its practice. In addition, I had more American goods to bring home with me to the United Kingdom. This applies to consumers all over the world, who through the foreign exchange debit card have been able to make better use of their cash when travelling abroad. This type of international trade is an extremely important part of globalisation as it is one of the ways in which different cultures gain understanding of each other.
On the other hand, it can be said that the foreign exchange debit card allowing for more spending when travelling is not a strong enough argument to suggest that it perpetuates globalisation. This is because in order for the foreign exchange debit card to perpetuate globalisation, it would need to fundamentally change the global landscape in such a way that the process of globalisation continues indefinitely. One example of a product that successfully perpetuates globalisation is information technology such as the internet news. The internet news increases the awareness of the global population on specific issues in different countries and cultures daily. This process will continue as long as the news exists, and if one accepts that Western society has crossed the Rubicon in terms of liberal democracy, the news will continue to perpetuate globalisation as long as there are people to read it. On the other hand, this can’t necessarily be said for the foreign exchange debit card. For example, the foreign exchange debit card would be rendered useless if/when digital payments become the global standard as credit/debit cards become redundant. Or, if taken to the extreme, there is an argument to say that in the establishment of a global currency there would be no need for exchange anymore. As such, the foreign exchange debit card is better described as a facilitator of globalisation.
Another way in which the foreign exchange debit card facilitates globalisation is through encouraging international travel. This is because the card has made it easier for consumers to access foreign currency at a lower price. This encourages travel as booking hotels and plane tickets in a foreign currency becomes cheaper for the average consumer. Travel is an extremely important component of globalisation as while information technology such as the internet news certainly does create a better understanding of the global cultural landscape, experiencing a culture in the flesh through travel establishes a connection to the new culture rooted in personal experience, and an understanding unabridged by media bias. As such, it can be argued that since the foreign exchange debit card allows consumers to travel for less money, which increases demand for travel, the process of globalisation is further facilitated by the card.
While this argument is convincing, it can also be argued that since travel is already expensive, small changes in the price of travel will not affect demand greatly. Essentially, since flights and hotels abroad are already expensive (usually into the $X00 total), a small saving due to a cheaper currency exchange may not affect demand for travel significantly enough to successfully argue that the foreign exchange debit card facilitates globalisation through increasing travel. This is because in order for someone who was not previously planning on travelling to be encouraged to travel, the saving they receive on their travels must be significant enough for them to get up and plan a holiday. For example, in order for budget flight operators in Europe, such as EasyJet, to sell the last seats on their short haul European flights, the cost of those seats are slashes well below 50% in order to encourage last-minute holidaying. The foreign exchange debit card doesn’t encourage last minute holidaying in the same way where receiving a saving of around 10% compared to your regular bank rate is the norm.
Even if it is true that the foreign exchange debit card does not encourage last minute holidaying, and therefore does not increase demand for travel in the short term, it can be said that those savings equate to a long-term increase in demand for travel. This is because future holidays can be planned around the fact that more money can be spent than usual, or more money can be saved for use domestically. The long-term increase in travel is a more favourable method of facilitating globalisation than a short-term boom, as the long-term will affect a far greater number of people, albeit over a longer time period.
In conclusion, it is clear that while the foreign exchange debit card emerged as an innovation within a pre-existing industry, it revolutionised the industry in such a way that it is reasonable to call it a direct, standalone product of globalisation. In addition, while it is not convincing to argue that the foreign exchange debit card perpetuates globalisation, it is certainly clear that it facilitates globalisation through encouraging international travel and trade.