Why Cash Is A Must In Hospitality!
November 14, 2022
Using your card or phone to pay for goods and services is great – until it’s not. For six million Australians, particularly the older population (according to the RBA), physical cash is still a necessary part of life. It is without a doubt that a multitude of businesses went cashless during the COVID-19 pandemic. However, as many merchants are still yet to return to accepting cash payments, customers are left with no choice but to walk away, going on to negatively impact a merchant’s revenue potential.
A recent survey reported that 99.7% of 15,000 participants want to retain the ability to pay with cash in Australia. Additionally, each note says, “legal tender” and “pay to the bearer”, meaning that the paying customer should be able to use the cash for any transaction they wish.
Further, paying for goods and services with cash helps assumes one’s right to privacy – of where, when, and what a consumer decides to purchase. For the hospitality industry, a customer may want to dabble on the pokies, TAB, or purchase food and beverages without being monitored by a business or lender. In this instance, having the ability to withdraw and pay with cash, allows the consumer a level of confidentiality in their own spending behaviours.
Additionally, physical cash helps big spenders set a budget that is ‘fixed’. A consumer heading to a club or pub can set their budget and stick to it by making a single cash withdrawal and holding onto their budgeted spend in physical notes and coins - in their pocket. While the cashless ‘tap and go’ option may be seamless, it presents a real danger of overspending for many consumers – especially in the hospitality scene.
Using cash is a harm minimisation tool that is recommended for gamblers. Leading researchers Dr Sally Gainsbury and Professor Alex Blaszczynski explain that cash is preferred by gamblers because of the breaks and limits it imposes: “The preference for the use of cash in gambling is often predicated on physical cash being a tangible way of limiting expenditure…”.
Some consumers may not realise that it costs businesses to accept some payment methods and card types. This is why it is common for merchants to charge a fee when the customer chooses to pay by card. From a consumer perspective, this extra fee may seem troublesome, especially during a time of inflation, however, the convenience of cashless payments comes at a cost for all.
If cash payments are removed from the industry, merchants may risk losing loyal customers – particularly those who belong to the older population. Cash is more than just a payment channel; it is secure, genuine, and difficult to counterfeit. Cash supports a merchant’s ability to grow and allows customers to have a choice in how they pay.
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