There has been a lot of talk recently about Ireland becoming a cashless society. In fact from 1 January it became cheaper for consumers to pay by debit card than walk to an ATM machine to take out money. This is thanks to the government’s 12 cent charge on ATM transactions, and the scrapping of the €5 stamp duty tax on debit and ATM cards. So, is your business ready for a cashless society? What is a cashless society anyway, and will it ever happen?
When technology advocates talk in absolute terms using phrases like the “cashless society”, people are understandably sceptical. After all, video didn’t kill the radio star, and there is no such thing as a paperless office. Is it going to be any different when it comes to the notes in our wallets and purses, and the coins in our pocket?
In Ireland we are attached to cash. In fact government bodies were among the slowest in the EU to begin moving away from making payments by cheque. Whether you are thinking about transactions like buying a pint in the pub or new shoes on the high street, it is hard to imagine a time when cash is gone completely.
So, let’s park talk about the cashless society and focus on consumer choice instead. This is actually what is driving the move towards cashless forms of payment – consumers like paying for things in this way. Trust in the technology is improving, and people are accepting of new technology that is delivered on a device they are comfortable with – primarily, their phone.
This change in consumer habits is what is accelerating the move away from cash.
Your business should embrace this move towards cashless payment, and you should consider offering your customers as many different ways to pay as possible – credit and debit cards are, after all, just the tip of the cashless iceberg. Contactless payments, mobile payments, and payments in virtual currencies are all gaining in popularity.
Your business can benefit from cashless payments in a number of ways:
- It’s cheaper – handling cash is expensive, even when you take into account merchant fees, setup fees, and other charges that are usually associated with cashless systems. There is the physical aspect of handling cash as well as the security, theft and fraud risks. It is also usually easier for your employees to make mistakes when handling cash.
- It’s quicker – cashless payments are faster to process than cash, so can save you time.
- Market research – you can extract better information about your customers with some cashless payment systems which can help with market research and developing future business strategies.
- Better service – you can also offer a better service to your customers by giving them a wider choice of ways to pay. This can even help you win new customers.
We don’t know when – or if – Ireland will become cashless. Sweden is one of the most advanced countries when it comes to consumers moving away from cash, but even they are not predicted to get rid of cash completely until 2030. In the UK cash payments are expected to fall by 30 percent over the next decade, but today almost half of all transactions are still made using cash.
The introduction of ATM fees by the government should help Ireland make up ground on our European neighbours, but completely cashless feels like a long way off. The trend is moving in that direction, though, so it makes good business sense to embrace it.
For more help and advice on implementing cashless payment systems in your business, or for any other matter, contact a Gilroy Gannon advisor today.