Towards a Cashless society?

Cash or card? A common question that can be altered by new forms of payment, as well as by the reduction of cash.

In countries such as Sweden, the disappearance of coins and banknotes is almost a reality, as it is legal not to admit cash for payments in shops and this is used in less than 1% of transactions carried out in the country. The same happens in other countries such as South Korea, China or the United Kingdom, but what is the situation in Spain?

Our country is, along with Germany, one of the European states that most use coins and banknotes according to the European Central Bank, but the card already displaces cash, accounting for 51% of Spanish purchases, compared to 39% of cash. Although this data is even more significant if we look at a specific generation: the millennials. 80% of these make their payments by card and add to the trend of payment via smartphone. This gives us some clues as to what the trend is in payment methods, and how they evolve not only from cash to electronic, but also towards the increasingly innovative and changing forms of digital payment.

In the middle of this evolution, the different players affected by the changes must be able to adapt to the situation, taking into account the speed at which consumers adopt the new payment methods. One of the players who cannot ignore this reality is the merchant: hotels, restaurants, shops, entertainment venues… All of them compete to achieve the greatest customer satisfaction, and this satisfaction also depends on how they pay. Therefore, it is essential to know the characteristics of their consumers, both socio-demographic and behavioural. For example, people in large cities will not pay the same as those who live in smaller towns and may not be as familiar with the digital world. Nor will the payment for local customers be the same as for those arriving from different countries and currencies, and the checkout process will probably also be different for those who spend large sums of money and for those who purchase low-value products.

In addition, it is also important to know the sector in which the business operates or the level of online shopping penetration, which will give clues about the likelihood that your customers will use cash or prefer new methods such as payment with ewallets or mobile devices.

The important thing, in any case, is that the business should be able to integrate all the payment methods that its company may need. But, as it was commented at the beginning, the environment and payment methods evolve rapidly, so how can merchants adapt to changes without a huge effort? Through a strategic partner.

Payments may not be the main focus of the merchant business and therefore the merchant may not be an expert in the industry. But there are companies that are exclusively dedicated to offering this service to their clients. Thus, a good partner will be the one that manages to add value through the integration of payments in all the necessary channels and forms, the improvement of the user experience and the increase in conversion ratios and loyalty thanks to the simplification of the checkout process.

In today’s market there are different players offering this type of service, including payment gateways. Sipay Plus, one of the Spanish payment gateways with the most experience in the sector after 25 years of experience, highlights the importance of “finding a partner capable not only of offering the integration of the different payment solutions, but also of advising the customer at all times and innovating to create personalised products that meet the expectations of each customer, as well as their end consumers“.

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