Wallets? Where We’re Going, We Don’t Need Wallets

Group of people paying for drinks at the bar and smilingHave you ever wondered what it might be like to live in a world without cash? In many parts of the world, this idea of the cashless society is already taking off. Sweden is moving the fastest: only 1 in 10 citizens reported paying for something with cash last year. Canada, where contactless mobile and card payments rule, is also eyeing a cashless future, including through its own digital currency.

That’s just two examples. What about the U.S. -- are we close to a cashless reality?

Imagine this.

It’s 7:00 a.m. Your alarm rings. You hit snooze a few too many times and are now running late for that 8:00 presentation with your boss.

7:48 a.m. There’s no time for the subway, so you grab your phone and schedule an Uber. It’ll be here in 2 minutes, so you rush out of the house. Once you shut the car door you realize you left your wallet on the kitchen table. Now what? The Uber’s paid for through the app, but what about the rest of your day?

7:49 a.m. You can’t do this presentation without caffeine. Luckily, you don’t need cash to fix that problem. From the Uber you mobile-order your usual (double skim latte) plus a cappuccino for your boss for pick up at the Starbucks next to your office. Your order will be ready in 5 minutes. And - good news! You just earned enough stars for a free coffee.

7:55 a.m. Your Uber drops you off. You run into Starbucks, grab your coffees and make it with seconds to spare. (The boss appreciated that coffee, by the way)

12:30 p.m. Lunchtime. Smartphone saves the day again. You order pizza through Grubhub to share with your coworkers. They Venmo you to split the bill.

6:00 p.m. You finish up and head home. First, you need to hit the grocery store. Heading to the subway, you worry you won’t be able to ride without cash, but… whew, mobile payments are accepted. You pay for your fare with a tap of your phone at the turnstile.

6:30 p.m. Quick stop at Whole Foods by your house, you flash your Amazon Prime QR code to get a discount and pay quickly via Apple Pay.

7:00 p.m. Finally home! And reunited with your wallet. You made it through the day without cash and didn’t skip a beat!

Wait. Is this kind of wallet-free, cashless day really possible today in the U.S.?

Not so fast. If you left your wallet home today, you’d probably survive -- but you’d likely hit a few snags. A restaurant, store, gas station or public transit system that doesn’t accept alternative payments could leave you scrambling for other options.

But the good news is payments technology and adoption have progressed to the point where foregoing your physical wallet is becoming more of a reality.

For one example, NFC mobile wallets and contactless chip cards are increasingly available for quick and secure in-store and transit payments. Meanwhile, merchants are busily enabling the functionality to accept them; more than 65 percent of all U.S. retail locations now accept NFC-based contactless payments. This is a huge jump from where we were just a year ago. The latest big names to go contactless: Target and the MTA

For another, peer-to-peer (P2P) payment apps like Zelle, PayPal and Venmo are gaining popularity fast, with upwards of 79 million American users last year. These apps make splitting tabs and paying for rent, rides and food delivery easy (and cash unnecessary).

Plus, with more merchants offering cashless alternatives like Buy Online, Pick Up in Store (BOPIS), there’s truly more flexibility and choice available in the way we pay.

Given these technology advancements, the number of U.S. retailers and restaurants going totally cashless is growing. While we’re not there yet, it’s only a matter of time before leaving your wallet at home is no big deal.

 

Ryan Ahern is the Payments Solutions Manager at Ingenico Group, North America

 

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