Not long ago, it was the norm to walk around with a good amount of cash in your wallet. Merchants were obliged to go to the bank each day to stock up on the change in all the denominations, both paper, and coin. And literally, hundreds of dollars of metal change found their way out of people’s savings and into jars, drawers, and sofa cushions, all because it was too heavy and impractical to carry it around.
Slowly but surely, this paradigm is shifting. Card transactions, and now other payment types such as NFC are rapidly making it more secure and efficient to forego cash entirely. U.S. Businesses need to keep up with these emerging technologies, in addition to accepting credit cards for small businesses. While the technology is slowly but surely making ground compared to cash here in the U.S., it’s worth noting how other markets are progressing quickly but surely toward a zero-cash market: namely, China.
Possibly due to China’s very different bank regulatory environment, consumers’ unwillingness to be nickeled and dimed to death by bank fees, and the country’s unwillingness to mint huge amounts of metal currency, it means that the shift from cash is going rapidly in the Middle Kingdom. It’s being led by two of China’s biggest companies: Alibaba and Tencent, with their respective payment technologies: Alipay & WeChatPay.
Payment cards didn’t catch on in China with the fire that they did in the U.S. markets. This, combined with the rapid expansion of QR and digital wallet tech, means that there’s a comparative vacuum in payment methods, which is speeding up the adoption of the tech use, compared to the States, where payment cards are entrenched as the “normal” way to pay.
The statistics surrounding these payment methods are a little shocking. Over 90% of the Chinese population use one of the two platforms mentioned above as their primary payment method, and they have around a billion customers each.
The question turns to the U.S. Will we be following the footsteps of China, with bankless payment technologies taking over as the primary way we pay? The odds are somewhat against it. As mentioned above, bank-based systems hold a huge amount of sway, and it will take time for that perception of security to change if it ever will.
For businesses here looking to stay onboard the latest in accepting credit cards for small business, step one is making sure that you have the tech to support newer types of payment, too. After all, it may not be the go-to payment method yet for most, but each year, more consumers are electing to use mobile wallets and other payments. Do your part, and make sure that customers can pay the way they want.