The Dangers Of Exclusively Contactless Payments For Your Business

23 January 2023

Back in 2020, when the world was put on hold with Coronavirus pandemic lockdowns, everything from travel to business and regular transactions simply stopped. No more morning coffee. No more evening commute. No more weekend brunch.

But nearly 3 years on, with most areas of society now reopened and businesses having returned to some form of 'normal', the lasting effects of the Coronavirus pandemic still remain when it comes to cash usage.

Misinformation about contact transmission of Covid has seen many consumers being pushed towards contactless payments as a way of saving people from the supposed excessive transference of germs. This is despite the fact that the World Health Organisation, has clearly stated since way back in the Summer of 2020 that cash carries no greater risk than other payment options like cards or mobiles.

So, with retailers and other businesses still seemingly reducing their acceptance of cash in light of the pandemic, are contactless payments really the safer way to operate, or are we are simply being blindly led down a rabbit hole of “tap to pay” without really understanding what is going on behind the scenes?

The Dangers of Contactless Payments for Businesses

While cash provides every customer with an equal opportunity to utilise and purchase your products and services, the limitation of being 'contactless only' instantly limits your customer base. This means that those customers without contactless cards; those without banking facilities or those who prefer to be cash-based (currently around 20% of the population, plus another 30% who still want to use cash as a backup to cards, according to the RSA’s Cash Census Report 2022) will no longer be able to shop in your store. Consider also consumers whose card is lost, faulty, or waiting to arrive – all of those customers will not be able to shop with you.

Even those customers who choose to shop with a limited amount of cash rather than a card, in an effort to curb their spending or help themselves stick to a budget, will no longer be able to shop with you. It’s important to remember that alongside the growing trend for card/contactless payments, we’re also seeing a growing trend for cash usage again in 2022/2023, spurred on by the cost-of-living crisis. Young people, in particular, are increasingly turning to cash-stuffing (and are spreading this trend via TikTok videos). Many other consumer groups of all ages are also turning back to cash to help them budget.

In essence, by championing contactless payments and eradicating the possibility of paying by cash, you may dramatically cut your customer base – leading to a potentially detrimental impact on your business. And at a time where all businesses are trying to recover from the impact of the pandemic on the economy and trying to stimulate consumer activity, it’s important to make sure you are able to cater for as many customers as possible and makes absolutely no sense to remain or champion being cashless.

Contactless Payment Security Risks

Aside from the lost business, contactless brings with it a whole host of security issues. Furthermore, it leads to reliance on one type of technology, which can pose a risk through its limitations and cause major issues when technology – as it sometimes does – fails, whether it be hardware or software problems, or a simple power cut.

Of course, retailers and companies can mitigate their risks against security challenges. For example, with the possibility of implementing high-level authentication and encryption behind each transaction. However, the investment in these high-level technologies may be too much for many retailers to bear at a time when costs for everything are rising. This is especially true as retailers already have to consider the transaction fee for every card payment, which is rising exponentially since Brexit saw the end of caps on card handler fees.

Consequently, when it comes down to a solely contactless future; it seems as though organisations have been a little hasty in eliminating cash from their business, without carefully considering the safety, security and financial implications.

Finding Safer Ways to Handle Cash with Volumatic

Whether for card, cash or contactless payments, the critical aspect for retailers is that every payment be as safe, efficient and cost-effective as possible. Fortunately, for every payment option, there are steps all retailers can take to improve payment processing, and for cash in particular, there are lots of cash handling options that offer enhanced security and efficiency, as well as being more cost-effective.

If you need to reduce the time you spend manually counting your till drawers, it’s worth investing in our CountEasy range of money counting scales, all of which can count a till drawer in less than a minute, giving you more time to spend with your customers and on those other essential jobs in-store. You can choose whether or not to have an integrated printer to keep track of your counts and there’s even a touchscreen version available too.

Or for the ultimate cash handling solution, our all-in-one CounterCache intelligent (CCi) takes care of everything and means your notes are only touched once from POS to your bank. The CCi counts, stores and validates banknotes in one easy step, and works in conjunction with our latest CashView Enterprise software to give you accurate reporting and accountability, while integrating seamlessly with any EPOS or cash reconciliation system.

Volumatic Sales and Marketing Director Mike Severs said: “At a time when consumers have less money to spend and are having to be choosy about where they spend their money, businesses should be doing all they can to help, and by investing in cash handling equipment they can actually save money, be more efficient, keep their staff more secure and keep their customers happy – it’s a win-win – and works out a lot cheaper than costly card fees.”

Giving Customers Different Payment Options

What the business world needs right now is to prioritise its customers. This may mean retailers have to create a balance by allowing different payment options to suit all of the ways consumers want to pay.

As Volumatic’s white paper, Consumers Demand Payment Choice, proved, while many consumers favour card payments, they still want to retain the choice to pay by cash and other methods, as and when it suits them and depending on what and where they make their purchase, and retail and hospitality outlets should be embracing that.

The reality is, if the consumer cannot pay in the way they wish to pay, they will simply walk out, or not return to shop with you next time - and you will be a transaction and a loyal customer down.