It’s happening all over. In an increasing number of cafes and shops, your money is no longer any good. And forget checks, the (often) young people behind the counters probably wouldn’t even know what to do with them.
Consumers have become conditioned to use cards for everything (think AmazonFresh for groceries). And as mobile wallets and apps become more popular, physical money is losing favor.
The ING International Survey entitled Mobile Banking 2017—Cashless Society researched the spending habits and mindsets of more than 14,000 adults in 15 countries to try to predict the future of cash.
Thirty-four percent of those polled in the U.S. say they rarely carry cash, and the same was true for 27 percent of Australians and 21 percent of Europeans.
In fact, only 63 percent of Americans have touched a bill or coin in the previous three days, compared to 92 percent of Turks and 78 percent of British respondents. Only those in the Netherlands use cash less frequently with only 60 percent using money in the same period.
For 21 percent of those in the U.S., it’s been a week since they completed a cash transaction and 10 percent have gone a month. For 3 percent of Americans, it’s been a year since they’ve spent a greenback.
“People may like the convenience of a card or mobile payment, instead of having to count and handle physical cash. However there can be a down side,” ING said in the report. “Behavioral science suggests that when people do not physically handle money, they do not tend to feel the “pain” of handing over cash as much when paying for something.”
Of course, that’s only a downside for consumers; businesses would likely see it as a benefit.
And if consumers’ cash aversion does actually equal more sales, companies will be happy to know that many of us are waiting for the day when cash finally goes away. The survey found that 38 percent of Americans are eager to dispense with dollars and 34 percent of Europeans wouldn’t bother with cash if they didn’t have to. The majority of Europeans (68 percent) would opt to patronize a cash-free establishment over one that only accepted notes and coins.
The move away from cold hard cash been ongoing for years and is slated to continue. Of those who used cash less in the previous 12 months, 78 percent think that frequency will dwindle further in the coming year. Twenty-two percent are planning to give it up entirely. Even 18 percent of those who did decrease their cash usage last year are slowing their dependence going forward.
This downward trend has been documented by ING over since it began asking the question in 2014. Each year about half of European respondents reported that they expected to use fewer bills.
While cash is still king for small expenditures like lunch and taxis, it’s losing favor for lager expenditures. For transactions over 100 euro, 12 percent more respondents are going for alternative payment methods rather than physical money. The same was true for residents of the U.S. and Australia.
Though consumers are moving ever closer to a cashless society, they do so while recognizing the risks. More than 60 percent of Europeans, Australians and Americans alike say that using bills provides them with a sense of privacy, while only about 30 percent feel the same way about alternative payment options.
“When people want transactions to remain private, they may choose to pay cash,” ING said. “But the convenience and traceability of many non-cash methods have their own appeal.”