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:
What they uncovered may surprise you.
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.
The primary concerns about the management of cash and currency at retail locations include:
“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.
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.