Impact of a cashless society

[27 November] Covid-19 has changed the way we live our lives. Social distancing, zoom social gatherings and a greater reliance on the internet are just the tip of the iceberg. As a society, we were already becoming less reliant on cash, and the pandemic has accelerated this.

A YouGov survey of 21 countries across four continents suggests that the coronavirus pandemic has made many people limit their use of cash in favour of electronic payments.

In Britain, half of people now use less coins and notes as a result of the pandemic; only 8% have seen their payment habits remains the same.

Almost half in GB want to keep cash

Attitudes to this cashless society vary across the globe, with 79% of people in India believing it’s a positive change, along with Malaysia (65%), the United Arab Emirates (63%) and Indonesia (63%). In Britain, close to half (47%) feel it would be a negative thing, with 26% view going cash free positively.

Already several countries have created cash free government working groups, including Dubai, where planned initiatives will target all segments of the community to create the infrastructure and favourable conditions for the elimination of cash.

What would retailers prefer?

Psychologically, people tend to spend more using a card than they would cash. The physical exchange of cash makes spending more ‘real’ than using a credit or debit card, while contactless technology removes the shopper a step further from the transaction. In addition, retailers tend to use store layouts to entice shoppers with impulse buys. Those paying with cash have greater awareness of their overall budget than those using plastic, often with overdrafts or spending buffers.

What do shoppers want to know?

While card-only payments have been common across the UK for a number of months, there are still people who rely heavily on cash. Approximately 1.2 million people living in the UK are unbanked, meaning they don’t have access to a bank account, leaving them facing a difficult task to simply purchase essential items. Vulnerable and older people, as well as those without legal immigration status are more likely to use cash than card payments.

Retailers and banks have a responsibility to balance the needs of all their customers, and while a cashless society may seem like a reasonable shift for younger or more financially stable audiences, there are vulnerable members of our society who rely on coins and notes, and want to feel reassured that their payments are just as valuable as digital transactions.

Throughout this year, we’ve focused on the importance of building a sense of trust and community with audiences, working to personalise content and build emotional connections, and the reassurance of vulnerable people falls within this. While the majority of people have no concerns about using card, a simple message from retailers or banks that highlights the continued acceptance of cash will be very welcomed by those who may have no other option, and Out of Home is well placed to deliver this content.