If you take a quick look into your wallet right now, how much cash is in there?
If you’re anything like the growing majority of people, you probably don’t have much cash on you – if any.
With so many new payment options, we appear to be well on our way to a cashless society.
The good thing is, this will help prevent the overstuffed wallet from causing you back problems like George Constanza from Seinfeld.
But in all seriousness, what does this mean for businesses?
Is paper currency on its way to extinction and if so, does this even matter?
A cashless society: the makeup
Let’s look at the numbers:
– Australia could be cashless by 2022 according to market analyst East & Partners.
– 79% of Australians think that making all electronic payments via smartphones will soon become the norm; found in the 2015 Westpac Cash Free report.
– The percentage of Australian consumer payments in cash has declined from 69% in 2007 to 37% in 2016 according to a Bulletin study.
Cash is still a big deal
Don’t be alarmed if this is not a world that you recognise.
There are still millions of people who prefer to use cash and even cheques.
In some cases, it may be a personal preference.
In others, it may be their only option.
Some may even think if credit cards haven’t killed off cash, it’s highly unlikely that digital transactions will be taking over anytime soon.
But if the way that we pay for things continues to change at the rate it has been, we are going to face some difficult questions about the future of our transactions and whether we can afford to keep cash at all.
Tap and go, as you go
When news broke back in 2017 that the $2 something… ATM fee to withdraw cash out of a ‘foreign’ ATM would be dropped by the four big banks, penny pinchers couldn’t contain their excitement.
Being a cash buyer might even have been enough to persuade a retailer to offer you a discount on a big-ticket item.
But now that we can do ‘virtually’ anything on mobile phones with apps like Apple Pay, Google Pay, Microsoft Pay, Samsung Pay, QR codes and more, more customers desire to skip the ATM before making a purchase.
This can provide businesses with more:
– enhanced security protection
– streamlined bookkeeping processes
– quicker, more efficient services
Several nations already on the move
Have you ever gone to pay for your food at a restaurant to only then find out they’re a ‘card only’ establishment?
This is not uncommon in Sweden where there are signs that say “No cash accepted” in more Swedish shops than not, and some banks no longer handle cash.
Cash payments are only 15% of retail sales in Sweden, and some point to Sweden as the model for a modern cashless society.
Consumers are mostly happy with this situation, but people with a low economic status and the elderly struggle with the changes of an electronic world.
Where to next Australia?
The concept of a cashless society isn’t new but the development over the past few years is showing a trend.
It took decades for store credit systems to be replaced by charge cards and finally credit cards, and cash survived all of that.
Where do you see us heading as a society, and do you think cashless is going to be the way to go?
Comment your thoughts below.