Is the Coronavirus Killing Off Cash?
Tech firms see the opportunity they have been waiting for as shoppers and business recoil from paper money. Who’s hurt when legal tender goes away?
From the beginning of the Coronavirus outbreak, stores and businesses were shuttering all over the World and many of those that were still open were balking at cash. Shoppers were switching orders to Amazon and Walmart.com. Many stores and businesses that have stayed open would not take cash requiring customers to pay either by debit or credit cards or paying first online. What once seemed like the oldest, most reliable way of paying suddenly seems a thing of the past.
The Coronavirus crisis drove businesses and people to prefer credit and debit payments to cash; a shift that is here to last. Digital payments are quick, clean and easy and that shift is now representing a huge opportunity for all retail and services businesses around the world. People did learn from their Coronavirus experience and, for many, this means no longer walking in a store or and office.
For years, I have been pushing toward a more virtual, less cash-based business and payments system, and pressing businesses and business owners to go online to free them from the uncertainty of being paid for their products or services and increase their sales and cash flow tenfold. The Coronavirus crisis is now providing me with one more argument to justify that business model: Due to the coronavirus crisis, people that resisted to shop online are now realizing how easy, economical and efficient it could be.
The only people I know that would not benefit from such a transition are the older and poorer people that tend to be more reliant on paper money either for lack of tech savvy, out of habit or because they do not participate in the formal banking system, the poorer and vulnerable people that do not have access to banks or credit cards.
You want to help these people!
For the duration of the pandemic, give them your products and provide them with your services free of charge. Donate to them directly, personally, the same way you donate to your preferred church or charity. This is good business. These people will be very grateful and let other people know about what you have done for them. Just do not forget to deduct these “promotional expenses” from your taxable income.
Some other people will still resist going online or using their credit card because they think that how they spend their money is nobody’s business, especially the taxation officer. Just take their money and put it in your left pocket. This is still good business. Just do not provide them with a receipt.
Money habits can be hard to break
The Covid-19 pandemic, has forced every one of us to change our spending habits almost overnight. It took years for ATMs to replace visits to human bank tellers. Now this is common ground. After resisting the move for years, many businesses started accepting credit cards and online payments either through their website or bank transfer. This shift in behavior is here to stay and for most businesses, it is now the right time to integrate in their business model infrastructure to support mobile banking and digital payments.
For others, the Coronavirus crisis is the rightful and legitimate occasion to turn their operations and business into fully cashless environments, that kind of economy, that long-held dream that I have been promoting for years. It is much, much faster to send money via the internet than to mail a check. It is much, much faster to get paid via the internet than waiting for the check in the mail.
For the duration of the Coronavirus crisis and its aftermath, I am here to help. Tell me how the pandemic impacted your business and lets see what we can do about it.
Meantime. stay safe.
Michel Ouellette, ll.l, ll.m
Business Growth Strategist
Systemic Strategic Planning / Crisis & Reputation Management
JMD Systemics Is Here To Help