The cashless economy is making Australians less generous
Digital payments are heavily impacting our spending habits.
Australia has some way to go before it can be considered a cashless society but new research suggests the effects of this transition are already being felt by consumers, businesses and even the homeless.
ME Bank surveyed 2,000 transaction account holders and found 61% were using less physical cash than they did five years prior, illustrating a strong inclination towards the utilisation of digital currency.
However, a substantial proportion of customers (39%) were using the same, if not more, physical cash now, despite the prevalence of online banking and contactless payments.
The survey suggests the trend of "going cashless" is having a negative effect on tradespeople, waiters and waitresses, charities and the less fortunate who rely on cash to get by.
While some philanthropic organisations have been able to keep pace with the digital world, many don't have the funding, staff, support or business acumen to do so.
Those customers using less cash believe the decision has altered and influenced their generosity.
These individuals claimed they were paying for services with cash 51% less often than they did five years ago and were tipping waiters 45% less often than in the past.
Respondents said donating to charities on the street was far less likely these days (-44%), as was handing over cash to buskers or entertainers (-42%) and giving money to the homeless (-42%).
| What impact has going cashless had on how often you…. | % less often |
|---|---|
| Pay for services with cash in hand i.e. tradies | 51% |
| Tip waiters | 45% |
| Donate to charity(s) on the street | 44% |
| Pay buskers or street entertainers | 42% |
| Give money to less fortunate people than you e.g. homeless | 42% |
"Consumers are benefitting from tracking their spending and innovations that make their lives easier such as apps that pay for coffee," ME Bank head of deposits and transactional banking Nic Emery said.
"But there are also losers in the growing preference for digital money, including those who in the past have relied on gratuities and cash donations like waiters and charities."
A separate report by Fung Global Retail & Technology suggests 60% of the world's "most digital-ready" countries are located within Europe. The reports also theorizes that the Scandinavian nation of Sweden could become the world's first completely cashless society by the year 2030.
Are we really becoming a cashless society? Aussies have embraced the concept of "tap and go" more than any other country in the world but research reveals an apparent aversion towards mobile payments.
Find out exactly how we'll benefit from this payments evolution.
Latest credit card headlines
- Best frequent flyer and rewards credit cards February 2020
- Best frequent flyer and rewards credit cards January 2020
- You own a business, so you should fly in business class
- How to use a business card to better manage your cash flow
- 5 ways to turn your business expenses into perks with Membership Rewards
Picture: Shutterstock
