If you listen to trend pieces in the news and online commenters, cash is on its way out. There are coffee shops and restaurants that don’t accept it, and most people don’t carry very much cash at any given time. Yet it turns out that retailers still generally prefer cash, since it’s the cheapest way to accept payments.
What about the extra expenses of dealing with cash, which include security, keeping a safe, and an armored car pickup for big enough businesses? Polly Mosendz over at Bloomberg News learned that even when you account for theft and the extra work of counting and preparing deposits, cash is still better for the bottom line.
“There are certainly costs involved with handling cash, but they are microscopic compared to the costs of accepting plastic,” explained a spokesman for trade group the National Retail Federation.
Going plastic-only also makes a symbolic statement. It says that you don’t want business from the estimated 7% of adults in this country who are unbanked, meaning that they don’t have a bank account, and use cash and reloadable debit cards to get by and pay bills.
That might not be the what the few businesses that have gone plastic-only intended, but it’s the effect that banishing cash has on a business.
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4 comments:
"Going plastic-only also makes a symbolic statement. It says that you don’t want business from the estimated 7% of adults in this country who are unbanked..."
That figure is not totally accurate because it excludes those the concisely chose not to use plastic.
Sand Box John
Cash is really good in the drug market.
11:01 - Cash is also very good in the underground economy - that's what kept this country alive during the previous POSPOTUS reign!
Ca$h will never disappear. Why? Because under the table payoffs to politicians and other crooks can only be made in ca$h, not plastic. That alone guarantees that politicians and those with big money will never allow that to change. Untaxed income can only be paid it ca$h. Many old people use ca$h and personal checks so they have no need for plastic. Ca$h will forever be king, corruption guarantees it.
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