The cashless society: how close is it?

Small business owners are working hard to adapt to the cashless society as new payment technologies mushroom in Australia. Are you in a position to handle the countless payment methods customers want to use? If not, then be prepared to miss out on the sale. 

 

Australian consumers are driving the trend toward a cashless society at a rate of knots, and small business owners need to ensure they’re equipped to take payments in various cashless forms.

According to the Reserve Bank of Australia, the use of cash has fallen sharply with the central bank’s most recent consumer payments study revealing the number of cash transactions plunged by more than a third between 2007 and 2013. While cash payments accounted for 70% of all transactions in 2007, they fell to just 47% in 2013.

Australia is one of the countries closest to becoming cash-free. That’s got big implications for every business.

Meanwhile, analysis as part of MasterCard's “Cashless Journey” project describes Australia as a country at a tipping point where “all the factors appear to be in place for a substantial move away from cash”. This same project gives Australia an 87% “readiness to go cashless” score.

The speed of change of our payment tools will drive change across the financial services ecosystem. For example, insurance will have to keep pace with this world of cashless payment: cyber-insurance offerings - which protect businesses and individuals from Internet-based risks - will have to evolve to keep up with how the payments function is changing. Speak to a Steadfast insurance broker, who can arrange cyber insurance quotes for you.

Cashless options

There’s plenty of cashless options out there. The Apple Pay app, for example, uses near field communication technology to take contactless payments via iPhones, iPads, MacBooks and Apple Watches.

Samsung Pay does the same for Galaxy devices, while the most recent entrant, Google’s Android Pay service, arrived in July 2016 with the system built-in to Android phones.

These digital wallet services simply require the phone to be tapped at the same terminal at which you would tap a card, but the heightened convenience is tempered somewhat by the fact that there are partner limitations with all three services.

Merchants benefit as much as consumers

Much of the coverage of the shift from the bank notes to plastic, and then to smartphones, is being driven by the consumer. This means that small businesses need to get up to speed.

Take a look at your financial institution - many have brought technology to market that makes it easier for small business operators to accept payment on the spot, have the money available in their bank account in real time and alert the customers when the money hits their bank account. Mobile point of sale (mPOS) technology allows merchants and tradespeople to use their phones as effective EFTPOS terminals.

It’s clear that the way in which we pay for goods and services is changing with incredible speed. Getting on top of the changes can help a business attract and retain customers, get paid quicker, and work more efficiently. Therefore, you need to make sure you’re up-to-date with how your customers want to pay, and that you’re making the options that suit them best available.

 

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