Has COVID-19 guaranteed the end of cash?
Two aspects of the pandemic have changed the way we spend – and neither of them is good news for cash.
Let’s set aside an underlying fact: consumer spending was hit hard in general by the pandemic. But the spending that is still happening, is happening in a different way than it did 12 months ago.
Firstly, for significant portions of 2020, most of us were locked away at home or staying home to stay safe, so the majority of our purchases moved online. From pre-prepared meals to groceries and alcohol, the shift to ordering things online which we’re perfectly capable of buying physically has been seismic.
Secondly, even the remaining face-to-face retail experiences changed, with contactless payments being encouraged across the board. With retail and hospitality staff under the pressure of handling potentially infected loose change and notes, contactless payment methods suddenly weren’t just convenient, they contributed to helping stop the spread.
A new no-cash habit
They say it takes six weeks to form a new habit. Most of us, particularly here in Melbourne, spent much longer than that getting used to this new cashless normal, shopping for groceries online at one extreme, at the other paying for even simple things like a morning coffee with a tap of a card or smartphone instead of using cash.
In Australia there are 16 million credit cards in use for a population of 22 million, so most of us have one, or at least a debit card to perform the same function. How many of us will go back to cash after this?
The resilience of online-first businesses
Having built and maintained online retail platforms for all manner of categories over the past decade, we at metronome are acutely aware of the ongoing eCommerce evolution, particularly in response to customer behaviour changes during the pandemic. We saw savvy business owners react quickly to the imposed lockdown and pivot their business to function, and in some cases thrive, in a predominantly online marketplace.
We also saw click and collect experience a boost, with consumers happy with the safety of shopping online and comforted by the short time required instore amongst other pesky human beings to pick up their goods.
Of course, demand for coins has been on the decline for a while – though it’s unlikely Royal Australian Mint Chief Executive Ross MacDiarmid could have foreseen the year we were about to have when he spoke to the ABC back in January 2020, quoting a 55% drop in the demand for coins over the last five years. That number may now be in a far more terminal trajectory.
So what does the future hold for the humble coin, the noble note? Apparently, you can’t stop change – unless it’s in your wallet, in which case, you probably can.
If your business is in need of an online sales upgrade, get in touch today.