Cashless payments have been on the rise in recent months, peaking in 2020. Besides the pandemic, the trend has been associated with increasingly changing consumer behaviors, coupled with the uptake of more online shopping and contactless payment solutions. Transactions that would ordinarily involve cash are being replaced by no-contact delivery, curbside pick-up, and online shopping.
According to payment processor Square, cashless transactions almost quadrupled in less than two months after the COVID-19 pandemic – rising from 8 percent to 30 percent. The firm recognizes a business to be cashless if over 95 percent of its transactions originate from debit and credit cards. The spike in cashless transactions has, however, been projected to prompt an increase in merchant fees. So, what is the future of cashless payments?