Mobile payments continue to gain a foothold in modern society, with businesses and consumers alike finding significant advantages in using digital wallets. It reduces the risks that come with carrying cash, while companies (such as quick-serve restaurant Split Bread) have found mobile payments improve record keeping and the speed of service. Nonetheless, there are still a significant number of uses for paper money that mobile payment providers have to broach.
For instance, when people have to split payments and transactions, cash is still one of the preferred ways of doing so. Same goes for borrowing or lending money to friends and family members – it's easier for people to simply open their wallets and hand out a few bills. These uses of cash are just some of the many reasons that people continue to carry paper money on their person every day.
The downsides of lending or splitting bills with cash
Granted, there are some significant downsides to lending or otherwise using cash for person-to-person purposes. For example, one recent survey conducted by Fiserve found that as many as 50 percent of people have let friends or family members not pay them back after paying for something because they felt bad about asking them for the money. This figure is the highest among young people, with 57 percent deciding to not ask to be repaid.
"While digital payments are now common for things such as paying bills, there has not really been a practical way to send money to another person electronically," Tom Roberts, senior vice president of marketing at Fiserv, explained in the report.
However, mobile payments continue to evolve, with providers developing workarounds to many of these drawbacks. At the Money 2020 conference in Las Vegas, Nev., several developers spoke about the ability to create person-to-person solutions that would further eliminate the need for cash. Of course, this would make it easier for consumers to pay each other at the point of purchase – no more owing money to others.
Minimizing the role of paper money
Although it's highly unlikely that paper money will ever go completely extinct in the near future, digital payments are slowly replacing much of the need for cash. Mobile payments already come with several major advantages – for example, a brand could incorporate mobile payments into a loyalty program that rewards customers for purchases, thereby enhancing mobile consumer engagement as well.
As consumers become increasingly comfortable using digital payments, whether it's to buy a jug of milk at a convenience store or to split the bill at a restaurant with their friends, they will be more likely to rely on them as their primary way of paying for their necessities. As this shift occurs, it will be crucial that brands integrate and embrace mobile payments. Solutions such as CaptureCode can help businesses implement mobile payments into their other smartphone-based consumers engagement efforts. Digital payments can be a significant boon to round out an otherwise well-developed mobile app.