Cash payments not going anywhere soon
While some business owners, especially those who only accept cash, are concerned about their future prospects and the development of a "cashless society," it appears these individuals have little to worry about. New research suggests transactions completed with cash are still alive and well and will continue to perform, meaning merchants will need to acquire an updated money counter.
According to a McKinsey & Co. study reported on by Barron's, the U.S. Bureau of Engraving and Printing produced 8.4 billion notes last year alone and new data shows there's a tremendous amount of U.S. currency currently in circulation. This indicates cash is still playing a vital role in the national economy and likely isn't going to disappear any time soon. The study revealed cash makes up for 29 percent of retail payments in the U.S., according to Barron's, a number that's nearly equal with the 30 percent of transactions that are paid for with credit cards.
Based on these numbers, Finextra determined the use of cash has dropped only about 19.5 percent per decade, a slow decline, especially considering the prominence of cards and new mobile payment techniques. Based on this number, the source determined that even if cash use continued to fall at this rate, cash use would not be fully eliminated until 2202 - nearly 200 years from now. However, a completely cashless society is unlikely.
While these numbers are purely speculative, it's highly unlikely cash will ever become an outdated payment method, making it essential for businesses to retain their cash counter and potentially even update these critical cash management tools. Consumers may rely less frequently on cash than they did before credit cards became popular, but they still depend on hard currency to help them avoid debts, interest payments and data breaches that can occur with credit cards.
July 23, 2013