Businesses had already picked up pace when it came to incorporating digital payments in addition to cash. However, in recent years, we have come across numerous examples of companies who down right refuse to take cash payments. These include various eateries, airlines, industries, and online stores. Consequently, the number of shopping sites that now accept eChecks, payments through mobile wallets, contactless payments, debit cards and credit cards has tremendously increased.
Some of the reasons why businesses prefer to eliminate cash payments are listed below. Take a look!
Drastic Reduction In Cash Handling Costs
Even a medium-sized business has to spend up to billion dollars just to handle cash inflow and outflow. This includes the expenditure of transporting cash, storing it, paying bank fees to manage the large amount of cash deposits.
You can imagine the cost that goes into hiring armored vehicles to carry cash from one point to another and employ salaries who are hired to count and register the balances everyday. To avoid all the hassle and practice more control over deposits, businesses tend to prefer digital payments and direct transfers via account number and routing number.
Ensures Transactions Proceed Quickly
Manual counting of cash can take hours to finish. This becomes more of a hassle when a business expands its operation. Therefore, the majority of the businesses that decided to go cashless did so in order to avoid slower transactions and increase the efficacy of their operation.
This in turn would help the company increase customer satisfaction level and consequently result in higher revenue for the business. All of this can be made possible simply by streamlining the transaction experience!
Reduces Theft and Frauds
Stores that keep cash in lockers at the counter are always prone to robberies. What will a thief break in for if he knows that there will be no cash present on site? This issue can be easily eliminated if the company chooses to let go of cash payments. The opportunities available for theft would be fewer.
Are There Downsides To Going Cashless?
There are strong arguments against businesses denying customers the flexibility to pay with cash. First of all, options like credit cards or mobile money transfers apps are not available to everyone. In fact, there are some US households who do not currently have a bank account. Eliminating the option to pay with cash would mean that these households will be deprived of buying many goods and services.
Even if a certain group of people have access to bank accounts, not everyone is comfortable making online or digital payments. Since the technology is rather new, people are doubtful of how reliable these are. Little is known about online scammers and having cash securely in the pockets gives a sense of control and safety that many enjoy.
There is another downside to working with credit cards and debits. In most of the cases, cash is cheaper to accept because companies don’t have to deal with card institute’s fees. Such charges are deducted every time a client’s credit card is swiped to transfer a payment.
In a Nutshell
If the trend to go cashless continues for big and small businesses, it could have more negative than positive impact on the society especially the middle-income consumers who tend to put more trust in cash payments instead of relying heavily on debit and credit cards. Although it makes sense why businesses were eager to adopt contactless and cashless payment methods, it would be more helpful if grocery markets and retailers would continue to offer multiple payment modes in the future.