Have you ever wondered what a world without cash would look like? Society is closer to this now than ever before.
Have you ever wondered what a world without cash would look like? Society is closer to this now than ever before. But like it or not, we are still tied to money for the majority of our transactions.
Despite calls that a new revolution is underway for digital payments, it seems that fintech innovation is still very incremental and evolutionary. Most of these apps serve as little more than digital versions of cash or credit card payments. They simply offer a way to pay for individual services electronically rather than adding some new innovative way to view payments and money in general.
When all these options are presented, it is hard not to look back and ask the big question: What was wrong with cold, hard cash?
Charlie Warzel with BuzzFeed may be asking the same question. He recently traveled all the way to Sweden in an attempt to go cashless. He ended up installing 64 apps on his phone and had a microchip put in his hand, just to make it through the month.
The main problem, as he pointed out, is that the highly fragmented digital wallet and payment solutions are not designed to help customers. Who are they designed for? The companies that make them.
Andy O’Dell works for Clutch, a company that specializes in these kinds of mobile purchasing apps. He explains, “Apple Pay and the Starbucks payment app have nothing to do with actual payments. The power of payments and the future of these programs is in the data they generate.” They can then use that data to not only predict but influence your behavior.
While many are excited about the idea of paying with a tap rather than a swipe, the companies behind the taps are chomping at the bit to get as many people on their programs as possible. Yes, they want your purchases, but more than that, they want to get to know you.
Finding out what consumers actually want and then offering it to them is the digital marketing endgame. Apps and payment processing systems give companies a glimpse at the spending habits of their users and allow them to offer more of what they think consumers will buy. Most people don’t like advertising because it wastes their time. If you were only shown things that were actually interesting to you, it might change the way you view them, which is why everyone is so keen on getting you to sign up for their membership card.
If you are eager to get on the digital payment train, you might be finding your wallet getting thicker rather than thinner. The good news is that there are plenty of apps to ease the growing collection of membership, payment, debit and credit cards in your pocket. Digital wallets like Google Wallet and Apple Passbook let you digitize most of your cards so that they can be accessed at the checkout directly through your mobile device. Since they use near-field communication (NFC) technology, your mobile phone or tablet must be NFC-enabled to be able to use them.
If you do not have an NFC-enabled device, you could try Geode by iCache. Geode is a $200 iPhone case and digital card (GeoCard) that allow you to digitally store credit cards and loyalty cards directly in the app. When you are ready to make a purchase, you simply select the card you want to use, remove the GeoCard from the case and swipe as usual. It will work temporarily as the card you selected. Once you slide it back into the case, it is wiped clean and ready for the next round.
For now, these apps are mostly focused on digitizing the meatspace world, but soon they will take on a life of their own and generate real value in customized offerings: genuinely cheap tickets to the places that we actually want to visit but don’t think that we can afford, discounts to stores that we would enjoy but have not heard of, and the ability to make micropayments for services that are too small to track now.
As apps begin providing true value to consumers, not just to the companies offering them, consumers will move en masse to adopt the technology. What would the world without cash look like? No one is quite sure yet, but every scan and beep at the checkout takes us one step along the evolution of our money.
Image from ESB Professional/Shutterstock
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