Are We Ready For a Cashless Society?
Cash is dying.
Though we have had the credit card since 1950, the advent of mobile payments has been the catalyst for the decline of cash usage in Western countries. More and more restaurants, retailers and service providers have ceased using cash as Americans become more used to swiping, tapping and scanning their way through their day-to-day business.
Global mobile revenue is expected to exceed $1 trillion by 2019, as many first-world economies scale down cash usage. While mobile payment is nothing new, the rate of adoption is skyrocketing, with more and more retailers taking advantage of the ubiquity of the smartphone to cut waiting times, maximize efficiency and increase sales.
How realistic is a cashless society? Well, in Sweden, the country which produced Europe’s first banknotes, cash is now used for barely 20% of transactions, well below the world average of 75%. The country has halved its banknote circulation in just over a decade. It is virtually impossible to navigate public transport or order coffee without some sort of cashless payment – cards are the most popular, but payment app Swish (similar to Venmo) is used by over 60% of the population. Other countries such as Denmark and the U.K. are following suit, with the proportion of cash purchases in U.K. chains such as Wetherspoons and Nando’s dropping drastically in recent years.
Here in the U.S., the cashless revolution has been a slow burner rather than an overnight coup d’état, with steady, single-digit increases in non-cash payments in recent years. However, restaurants going cashless is becoming more and more common.
Tender Greens and sweetgreen are two popular salad chains that no longer accept cash. Since the change, sweetgreen has seen a reduction in robberies, while Tender Greens has slashed ordering times by ten seconds. Exceptions have to be made for locations here in Massachusetts, where retail establishments cannot refuse cash as a form of payment.
Australian-style cafe Bluestone Lane also hit the headlines for their decision to go cashless in 2016. Despite some teething problems, it has ultimately cut customer processing times and helped business – a hugely encouraging story for any smaller brands considering the switch. On a larger scale, Starbucks has toyed with the idea, testing a cashless store in Seattle.
While it looks like it will be some time before the American consumer is willing to dispense with cash entirely, the signs are showing that a tectonic shift is occurring in how we spend money. The long-awaited adoption of EMV-standard cards means that cashless payment has never been as secure. Digital wallets are slowly replacing their leather counterparts, as consumers begin to embrace the convenience of life with fewer notes and coins. Time, technology, and innovation will do the rest.
To make sure you never miss out on the hottest news, stories and industry insights, subscribe to the blog here: