The past year brought along a flurry of disruption to the payments world. From cryptocurrency to peer to peer payments – how, where, and when people are paying is changing.
One important development is the slow demise of cash. Across the country, both restaurants and retail shops have begun experimenting with removing the option to pay with cash. But before we speak to tales of a cashless society, let’s take a look at the pros and cons of businesses going cashless today.
Increase Speed of Service
As more and more counter service and fast casual spots pop up – the demand for a faster, more convenient in-store experience is increasingly prevalent.. By going cashless you would reduce friction by getting rid of the time spent paying with cash and giving change back.
Cash boxes are a prime target for thieves. By not having cash lying around at your business you are reducing the risk of being robbed, including from your own employees!
Reconciling cash at the end of the day is time consuming and leaves room for human error. These administrative costs can have an effect on your bottom line. While on the other hand, credit and debit cards transactions automatically reconcile with your bank, keeping you on top of your financials in real-time.
It’s much easier to collect customer data and make sense of that data when customers pay by card. By tracking this data, merchants can track purchasing behavior, segment their customers, and personalize rewards based off of their purchasing history.
Tysys breaks down where cash is being used compared to debit and credit cards:
When evaluating whether to go cashless, it’s important to see how cash is being used in your area of business. One clear pattern is that as products and services get more expensive, customers are more likely to use card over cash.
Businesses have to pay a fee per credit card transaction, and in response many tack on an additional fee to the consumer to offset the transaction cost. For customers that prefer to pay with cash, this can turn them off to doing business with you.