Digital payment - retail payment technology

How retail payment technology is evolving in response to consumer demand


Is cash going away or here to stay? We surveyed retailers to find out.

Read time: 3 minutes

Cash today, cashless tomorrow?

It seems natural to assume that the continuous evolution of cashless payment technology, accelerated by the Covid-19 pandemic, will ultimately eliminate the use of cash. But there are valid reasons and behaviors that indicate otherwise.

The Service Advantage team at Ricoh, USA surveyed domestic retailers to find out:

  • Current currency management trends,

  • Future predictions, and 

  • How they plan to evolve their payment options for consumers.

What they uncovered may surprise you.

The cashless movement

There is no doubt that a cashless movement is underway. An increasing number of businesses are actively avoiding taking cash as a form of payment.

Yet, despite the drive to become cashless, industries that attract audiences across various economic situations – like sports stadiums, airlines, eateries and merchandise stores, continue to see the predominant use of cash amongst young, elderly and "unbankable" consumers.

Many states and local laws in the US also require merchants accept cash to avoid discrimination against those who can’t afford to have a bank account.

Therefore, significant investments in technologies that support Payment Choice, such as reverse ATM’s, cash recyclers, and similar equipment, continue to be necessary.

Retailer insights

Ricoh surveyed a wide range of retail managers and executives, with most establishments including an average of 26-100 stores and annual revenues of $100K - $1.5M. The top two outlet types were Supermarkets and General merchandise stores.

Those surveyed reported that 26% to 50% of store transactions are made in cash, with most cash purchases in the $10 to $50 range.

When asked why their stores continue to accept cash payments, the most common reason was “A large percentage of customers are unbankable/need to use cash” and “Government mandates.”

Almost 68% said their city or state requires retailers to accept cash. Security and privacy were also a driving reason for accepting cash.

Even so, when asked if they think the US is headed towards a “Cashless Economy” in the next 10 years, the overwhelming answer was yes.

Pandemic impact on retail payment practices

Many retailers added digital shopping enhancements because of the Covid-19 pandemic. The most added methods were: Buy-Online-Pickup-In-Store (BOPIS), curbside pickup, home delivery, and forms of ecommerce.

An overwhelming 88% said they plan to keep these digital shopping enhancements post-pandemic.

72% of responders said that they are experiencing a labor shortage, which supports the use of these digital shopping enhancements.

Ricoh retail payment technology - figure chart

Cash management and technology

The primary concerns about the management of cash and currency at retail locations include: 

  • Counterfeiting

  • Cash shrink/theft

  • Cash leakage/control issues

  • Concerns for potential employee errors and safety. 

“Managing the total daily cash intake” and “Limited or poor-quality transaction devices” were cited as today’s biggest struggles amongst retailers.

The most popular cash management technology currently in use includes automated cash recyclers, ecommerce, and ATM’s.

At the same time, mobile phone checkout is on the rise, as well as POS keypads/card readers or tablets. Surprisingly, bitcoin/cryptocurrency kiosks are more prevalent than self-checkout. Most retailers reported they will invest in technology to keep current with industry trends and customer behavior, such as the growing interest in mobile phone checkout, self-scan mobile apps, and various methods of consumer self-checkout.

When asked what holds retailers back from investing in new technology, cost is not the biggest driving factor, it is “Customer confusion or resistance” as well as “Operational complexity.”

A large portion of retail respondents report they are planning to adopt or implement new cash handling or payment technologies with the year, or within the next 2 years, and have an expected budget of $100K to $500K for that new equipment. Most are interested in leasing new equipment versus purchasing it.

The bottom line: Consumers demand payment choice

The global Covid-19 pandemic heightened the focus on, and advancement of, non-cash payment methods, but cash remains strong for certain types of transactions, small price points and amongst specific population groups.

Businesses and industries who are shifting to 100% cashless transactions are still investing in reverse ATM’s, cash recyclers and other cash management technologies to serve their customers who prefer cash while solving operational concerns like efficiency and security.

Many retailers and consumers anticipate a cashless economy within the next ten years. Therefore, retailers will continue investment in point of sale and mobile phone/digital wallet technologies that provide consumers with secure, convenient transactions.

Cryptocurrency is expected to gain traction, but right now it’s still confusing to many consumers, lacks fraud protection and is not widely accepted by retailers as direct payment.

The bottom line is that cash users are also using digital payment methods, just not exclusively, and legal tender continues to be resilient. Including cash in the digital economy will continue to enable all consumers to exercise payment choice.

For more information, read The Future of Payment Choice, featuring insights from consumers, retailers, equipment manufacturers and cash-in-transit providers on the resiliency of cash in an increasingly digital economy.

Ricoh Service Advantage works with retail businesses and retail technology providers to make it easier for you to support your technology investments, drive innovation, automate processes, and improve the experience for your customers. Contact Ricoh Service Advantage to learn more about support for your automation, robotics, point-of-sale, or currency handling equipment.

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