The British public are always one of the quickest to embrace technological advances. Computers, phones, appliances in our homes – we love our gadgets. Nowhere is this clearer than in the demise of cash and the rise of cashless payments.
To put this theory to the test, merchant service provider Handepay launched The Cashless Street – a social experiment with a group of independent retailers in Manchester to see if they could go cashless for 24 hours. With statistics showing that 58% of independent businesses do not let their customers pay by card – at a time when card payments are booming – this is the sector that needs the most convincing of the value of card payments.
“We charge 25p for transactions under a fiver, and have never had bad customer reactions. The key for us is that we also offer a free ATM machine to provide an alternative payment.
“People often still don’t know about contactless and I enjoy seeing their faces when using it for the first time. Not only does it make their day but these payments are free for us to process. Everyone’s a winner.”
Nisa Local, Great Barr, Birmingham
The day was a huge success with a substantial increase in sales and everyone discussing the potential of a cashless future – 43% of those polled on the street believed that we are already ready as a society to go cashless.
Jon Charles, owner of bar/restaurant The Laundrette on Beech Road, Chorlton, was keen to point out the benefits: “We like cards. It works for us because people spend more money. We don’t have to store masses of cash on site; I don’t have to take the money down to the bank every Monday. It’s cleaner, it saves me time and effort and is also a lot safer.”
The results of the event revealed the importance of card payments when growing your business. A poll of shoppers carried out on the day revealed that 60% of people have left a shop because they didn’t offer card payments and 53% would shop local more often if they knew they could pay on a card everywhere.
So as we hurtle towards a cashless society, it’s more vital than ever that businesses of all sizes keep pace with consumer trends. If you’re still unsure whether taking card payments is right for you, we’ve compiled a list of the top three benefits.
Speed and Efficiency
Contactless payment is booming at the moment as the next step in payment technology after chip and PIN. Each transaction takes less than a second to process, making it ideal for our on-the-go society. Everyone is a winner with contactless, business owners love it because it speeds up transaction times, cuts down on queues and reduces lost sales from people leaving when they see a busy shop and decide they don’t have time to wait. There’s even more time for interaction with your customers.
Keeping large sums of cash on your business’s premises increases the amount of time you’ll spend managing finances and also creates an added security risk. Having less cash on your premises makes you less of a target to thieves. Card providers go to high lengths to make sure you are protected from fraud. With contactless payment, businesses won’t be exposed to any greater risks as this process uses exactly the same high level technology that’s behind chip and PIN.
Card carrying encourages impulse spending. A report for the American Psychological Association found that, when paying with cash, “there is a tight coupling of the consumption and the payment, thereby accentuating the pain of paying. In the case of credit card purchases, actual parting of the money occurs after the purchase decision, thereby dulling the pain of paying.” With cash, we are more aware of how much money we are spending, but when spending on cards we are less conscious. Essentially, cash encourages self-control while other forms of payment encourage greater spending. That’s good news for business.
Watch the video below to see how the experiment went.
Would like to have a chashless store someday? Let us know your comments.