One result of this COVID disaster is that usage of card-only transactions has increased. Many of my clients have seen a significant reduction in their cash transactions. According to some figures, I have seen about 30% of Australians now no longer use cash. Some are saying that within three years in Australia, we will ditch notes and coins. Here is an interesting video on some of the issues.
I doubt it. Many of our clients have tried card-only transactions. They quickly reverted to accepting cash. The Reserve Bank of Australia in December reported that, while cash has fallen, it was not plummeting. I remember similar statements said about cheques a few years ago, well cheques are still used today. Still, there are many signs that Australia is moving into a more cashless society which does not mean cashless.
I expect that with lockdown ending, cash will go up. Conversely, cashless will go up as our Social Security will be offering large numbers of Australians a free debit card CDC. I have been told that only our clients are using CDC in our market space now, but I expect this to change soon.
BNPL, e.g. Afterpay, is growing and now makes up about 10% of cashless transactions. The worry here is the high added cost to retailers as they pay with BNPL much of the fees.
These cashless transaction fees are a long-term problem for retailers. Particularly smaller retailers, as their fees are proportionally bigger.
The question here is, what are you going to do about it?
Many of my clients have introduced EFTPOS fees, then claiming it did not affect their trade. I doubt it; when I look at their sales using big data, I can often see an impact. It is small but its there.
I have noticed that many of my clients when asking me, have not done much research. So I have been able to get them significantly reduced fees on cashless transactions.
Note: I am not saying that fees are the only criteria. For example, the quality of service is also important, as recent events with outages have shown.
The other issue is that large organisations enjoy card payments analysis with detailed reports on their customers that smaller retailers cannot get unless they have a DTI system installed.
