Home' The Channel Magazine : N-View 2017 Contents 52 | N-View 2017
Cash circulation, long on the decline, has plunged since the
time of the robbery, from a hundred and six billion Swedish
kronor, to seventy-seven billion last year. By 2014, only one in
five transactions were conducted in cash. About 50% of the
countries bank branches don’t allow withdrawals or deposits in
Seeing the decline in cash transactions, six of Sweden’s
largest banks collaborated to create Swish, a mobile payments
application. Swish now has more than half the population using
the app, with 90% penetration amongst 20 to 22 year olds.
Closer to home, Kensington St, Chippendale, has
permanently banned all cash payments. In August 2017, Spice
Alley, which turned a row of terrace back gardens into an Asian
style hawker food stall, installed a policy amongst its vendors
that only “tap and go” cards would be accepted.
The reasoning behind the decision was to speed up
queues, stop serving staff from handling cash and reduce the
amount of time in banking administration.
Australia has the fourth highest rate of contactless
transactions. A recent study by the Reserve Bank of Australia
found that the use of banknotes and coins fell from 69% in
2007 to just 47% in 2013. The decline took place across all age
and income groups, with people in rural locations more likely to
be using cash than those in major cities.
The Australian Payments Clearing Association reports that
cash usage is declining in Australia by around 5% per year,
while non-cash payments were increasing by 9% annually.
A study on Australian consumers reveals that businesses
who restrict customers from making electronic payments
are putting themselves at risk, with 44% of respondents
avoiding retailers that do not allow the use of cards for small
The online study on payment choice for low-value
transactions (i.e. purchases under $10), commissioned by
Mastercard, surveyed Australian card holders aged between
18-64 years old.
Respondents surveyed said they are increasingly
agitated when retailers require them to pay cash for smaller
purchases or where there is a minimum spend required. Up
to 84% of consumers resent paying a fee, while over 60%
find it frustrating when they cannot use cards, for small
As Australian consumers move towards a cashless future,
what they want from retailers is the ability to choose the
type of payment for any purchases made. Galaxy research
commissioned by Mastercard showed that two-thirds of
Australians have reduced the amount of cash they carry, with
53% carrying less than $50 in cash at any time.
While Australian consumers have been quick to embrace
the technology, many retailers are still resisting, citing
transactional costs being the reason for requiring minimum
spend for card purchases.
However, long-time newsagents Ian Hunt and Narith Lim
made the decision to remove restrictions for card purchases in
response to meeting the needs of their customers.
Hunts Civic Centre Newsagency owner Ian Hunt made
the decision around 10 years ago after a discussion with his
daughters. Hunt has owned his business for 30 years.
“I’ve got three daughters, who all shop with their credit
cards and don’t like it when there are minimum restrictions to
purchases,” said Hunt. “So we made the decision to remove it.
It’s the way of the future.”
The newsagency has an average customer spend of $10,
with around 70% of daily sales made via card purchase.
“We have competitors near us that charge fees for credit
card usage and customers prefer to shop here,” said Hunt.
“That’s the legacy of providing this service. We are in a part of
Civic where there a lot of professionals. A lot of younger staff
working in the area. It’s the way retail is going.
With such a high percentage of sale transactions on
cards there has been an added benefit in saving time with
administration and banking.
“The security side of things is that I don’t have to worry
about going to the bank. The money is drawn into my account
the next day,” said Hunt.
Narith Lim has owned Greystanes Centre Newsagency
for 13 years and made the decision two years ago to remove
restrictions on small card transactions for card purchases.
“Before I put a $10 minimum spend and we lost
customers,” said Lim. “If you put the minimum $10, like we did
before, we lost the customer and they walked away. Because
they had no cash in their pocket, we lost them.
“Sometimes it’s only $6 and they ask if they can use their
card. If you do not take the card, then you lose the customer.”
With the shopping centre redeveloped a couple of years
ago, Lim’s business was moved opposite a new Woolworths,
complete with self-serve registers and a cafe. The suburb of
Greystanes is made up of young working families who prefer
transact on card.
“We try to take whatever they use because the
supermarket, they take $2, $3. That is why we had to follow,
said Lim. “If people spend $3, it doesn’t matter. We want to
make the customer happy.”
Mastercard launched the Zero Minimum Campaign back in April, which encourages
retailers to offer customers restriction-free cashless transactions. To find out more about
participating in the Zero Dollar Minimum campaign, please visit
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