The Cash Free Trend
Cash is the typical method of paying globally. However, across the U.S. and even the world, more and more restaurants are becoming cashless, keeping every cent digital. While This might be frustrating to a certain few; only being able to use one method of payment is difficult for many, especially those who are too young for credit cards. However, it is understandable why this is becoming a global trend, as it is incredibly beneficial to these store and restaurant owners. Here’s why!
For example, in Baltimore, Maryland, after the fifth time the Park Café & Coffee Bar was held up at gunpoint, the owner decided to remove the cause: cash. Taped to the café’s door the next day was a note that read, “Due to the recent robberies and continued crime in the neighborhood we are no longer accepting cash.”
The move was intended to be temporary, but owner David Hart might not return to the old payment practice. As Hart explained to the Baltimore Sun, “Going cashless for me was something that I felt forced into, and yet now that I’ve made that decision the feedback from the community has been very positive.”
Although Hart admits that several customers were annoyed at first when their cash was not accepted, they seemed to understand once the reason was explained. While 20-25% of Park Café’s sales were paid for in cash before the switch, Hart estimates that just 5 or 10% of customers paying in cash didn’t have a card. Other restaurants undergoing cashless transitions claim that business won’t be hurt, since upwards of 90% of their sales are paid for with cards anyway.
Hart is considering ways to accommodate customers without credit cards.
Exchanging plastic for cash is a proven method for reducing crime. In the early ’90s, the government stopped paying out welfare in checks that would be cashed out, opting for electronic transfers that distributed debit cards to recipients instead. In other parts of the world, South Korea and Scandinavian countries Denmark, Norway, and Sweden have encouraged digital payment methods over cash. To reduce money laundering and crime, the European Union has plans to phase out the 500-Euro note by 2020.
In cases like Park Café, where crime is a constant issue, going cashless adds a new level of security.
Popular restaurant chain Sweetgreen, part of the sustainable food movement, have gone cashless in all 75 locations nationwid
e besides those in Massachusetts, as it is illegal in the state not to accept cash. Cofounders Jonathan Neman and Nicolas Jammet list crime prevention as a supporting argument for going cashless, but their real motivation is innovation. In an interview with Fast Company last year, Neman expressed confidence in a future that’s cash-free. “We believe the future is hyper-experiential and hyper-convenient. The middle is going to get squeezed out.”
Sweetgreen caters to a crowd that wants to eat something fast and healthy for lunch. The duo argues that by accepting debit and credit cards only, locations increase their meal output. The pair claims that card-only payment will not only improve efficiency, but this will make the experience more personal overall.
Considering that most people pay for fast food with cash, going cashless would seem counterintuitive. But after testing the cash-free payment model in select locations, the Sweetgreen founders are confident that it’s the right move. “Cash has become such a smaller piece of our tender,” Jammet explained to Fast Company. “When we opened nine years ago, it was 40%. Now, all stores are between 10% and 15%.”
The testing period showed that Sweetgreen’s customers don’t care how they pay, so long as the process is clearly explained beforehand. Going cashless might also encourage customers to start using the Sweetgreen app to pre-order their meals, the ideal direction for a tech-inclined company to head in.
Ultimately, a cashless future is in the making, as other local chains such as Dos Toros, Dig Inn, and Pasta Flyer have the made the switch. All of these restaurants have mainly changed for the purpose of simpler payment, and more and more businesses are hopping on the credit card exclusive train every day.