Here's Why Businesses Should Invest In Cashless Payments Systems Now When talking about cashless payment systems, we should also recognize a marked improvement in the quality of the customer experience – no small feat!
By Muhannad Ebwini •
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A recent study conducted by the Broad College of Business at Michigan State University reports that contactless payments are still on the rise throughout 2022, with them maintaining a stronghold as the go-to method for consumers in their everyday lives.
Cashless payment systems implement products like credit or debit cards, point of sale (POS) terminals, direct debit bank transfers, mobile apps, mobile wallets, quick response (QR) codes, cryptocurrencies, gift cards, or vouchers, to execute transactions without the use of any physical money. With countries like Finland, Australia, Sweden, and South Korea leading the way, cashless societies are on the rise globally, and it seems they won't stop anytime soon. In the United Kingdom, a trade association for Britain's banking and financial services sector, reports that the number of UK residents leading "an almost cashless life has more than doubled in two years," from 3.4 million in 2017 to 7.4 million in 2019.
Of course, most physical stores will still accept cash, but cashless shops are on the rise too, and I believe they will continue to be. This is due in large part to the ease, efficacy, convenience, and security facilitated by cashless methods, which have grown on consumers during the COVID-19 pandemic years, and have now become more than a trend, and instead, a key preference that's here to stay.
So, it's clear to see that consumers prefer cashless payments, but are they beneficial to businesses too? What should businesses know about implementing cashless payments systems, and how to make such processes work for their specific needs?
By going cashless, businesses can trust that the level of security in their stores will easily and immediately increase: holding cash in a register or behind the counter lends itself to unnecessary risks, both from staff or robbers, whereas cashless and digital payments are designed to be safe and ensure a high level of security.
Related: How Digital Payments Can Enable SMEs To Become More Competitive In The Post-Pandemic Era
Businesses can also increase efficiency and speed with cashless transactions, as they can say goodbye to waiting in line at a bank or an automated teller machine (ATM) in order to deposit and withdraw funds. It all happens automatically and without any delay, as digital transactions go straight from one account to the other.
Plus, as there's no need to spend time on cash accounting at the end of the day, when staff just want to go home and the margin for errors is high, there's an added bonus in terms of time-saving and accuracy improvement.
Think of an example like Starbucks, which started testing out cashless locations in 2018. In the middle of a busy morning, with rush-hour lines and irritated customers, the coffee chain needed to find ways of reducing wait time and improving efficiency. Their solution? Mobile pre-order apps, a customer favorite!
When talking about cashless payment systems, we should also recognize a marked improvement in the quality of the customer experience – no small feat! Since cashless transactions save time, it follows that more clients can be served in a shorter period of time, and that they will remember their delight and satisfaction next time they visit the store.
Naturally, this also boosts profits, as the business can make more sales in the same amount of time, but that's not all: by analyzing individualized data, which is made possible by implementing a cashless payment system rather than physical money, businesses can get to know their customers better, and in turn, provide better service.
A close business-client relation is crucial because it can build loyalty, improve retention, and ensure profitability. Anything that businesses can do to strengthen that link, they should keep in mind, will prove an investment and a smart business decision in the long term- even if it might seem like a hassle, complicated, or strange to implement cashless systems, going forward, it might result in positive improvements across the board.
That's the signal that countries like Finland, South Korea, Sweden, and more are sending, and I believe we'd be wise to listen.
Related: Cutting Costs And Managing Expenses As A Business: The How-To
