As acceptance for digital payment grows, the debate for whether cash can continue as a payment method continues.

Should global economies continue to allow cash payments or go cashless?

Critics say moving to an entirely digital economy would alienate the unbanked, but others say failure to go cashless could limit the expansion of the fintech sector.

Cash and digital payments can exist hand-in-hand, in fact, many consumers prefer having payment options (MobilePaymentsToday).  Flexible payment options including bank transfer, credit card, cash, or mobile wallet, are key to a consumer’s seamless checkout experience.  According to new PPRO data, over half of the consumers in the US and UK will not complete their checkout if it is too complicated or their preferred payment method is unavailable. 

In short, the customer rules, and customers want to pay with the method(s) they are comfortable with.  The vast majority of online shoppers will abandon the cart and purchase items from another retailer if they aren’t able to checkout using their preferred method.  For US-based shoppers, preferred payment for online transactions is typically a major credit card, but for EU consumers, a more typical method could be a bank transfer method.  

Cash in a digital age

Despite a rapid shift toward digital acceptance, experts advise cash isn’t going anywhere anytime soon. 

One reason cash is safe is that many regions are loyal to cash-based systems.  For example, 21 percent of transactions in Latin America are completed with cash according to MobilePaymentsToday.  Many other regions, including both New York City and Philadelphia, have even introduced bans to prohibit businesses from going cashless.  These bans are in place, in part, to protect the unbanked and underbanked.

Payment Options and Customer Service 

From a customer service perspective, payment methods should serve to enhance the consumer shopping experience, and flexible payment options offer just that. Cash can actually serve to complement digital payment methods.  For example, in Argentina, Mexico, and Brazil, cash-based payment methods like RapiPago, Oxxo, and Boleto Bancario provide consumers who are dependent on cash a chance to shop online (MPT). 

Merchants should work to understand buying behaviors and provide local payment methods for their target customers.  Providing a choice to customers is the key to a great experience. Digital acceptance does not have to mean cash avoidance.