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What Happens to Tipping When Cash Disappears?

Wednesday, July 17, 2019

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by PYMNTS.com

A trip to a restroom, even in a restaurant in which customers tend to wear slacks instead of shorts, is a relatively simple and even boring affair (stick with us here; we have a point). With the spread of digital payments, one of the luxuries of those restroom visits is in danger of disappearing – another mark of how the ongoing decline of cash is changing a host of once common activities.

Here’s the scoop: The New York Times, in an article published earlier this week (May 8), was the latest source to document the decline of the restroom attendant.

Surely you have encountered one – if not at an upscale eatery, then at a wedding or anniversary celebration, or in a club with bottle service, or perhaps even at a foreign hotel. A person does his or her business, and the attendant – in expectation of a cash tip – hands over towels, or perfume or cologne, or a mint. Perhaps the attendant even laughs at the customer’s joke, no matter how funny or lame it might be. Not to get too off-topic here, but the restroom attendant used to feature in a fair number of movies, sometimes fulfilling a role of someone akin to a bartender, dispensing timely advice to a main character or simply fulfilling another plot function.

The Role of Cash

But people aren’t carrying around as much (or any) cash these days, and that’s part of what’s causing the current woeful situation for restroom attendants – at least according to most stories about the topic, including the one this week from the Times. There are other factors reportedly involved, mostly cultural, but the cash angle seems to be among the bigger causes, and we here at PYMNTS are mostly concerned about, uh, payments, so let’s dig deeper into that.

Indeed, PYMNTS research has already documented the link between the carrying of cash and the need to provide tips in various situations. The newest PYMNTS How We Will Pay report found that almost half of the consumers studied for that document carried between $10 and $50 in cash in their wallets, largely reserved for tipping (39 percent) but also for buying things from small merchants that do not accept cards (24 percent).

The influence of tipping on the larger world of payments goes well beyond restaurant attendants and carrying around a modest reserve of cash, though.

A funny thing is going on in the wider U.S. economy in regard to tipping (the U.S. generally being more devoted to tipping than most other Western countries, for various economic, legal and cultural reasons). More merchants and service providers are nudging their customers for tips – think about the debate over how much extra to leave your barista, for instance, or the enduring controversy over whether to tip hotel housekeepers, and how much. At the same time, cash is becoming less popular, leaving consumers sometimes with empty pockets when the moment of truth – whether to tip, and how much – finally arrives.

Read the full article from PYMNTS.com here.

The Withdraw Cash Wednesday campaign is designed to promote consumer cash usage by reminding consumers to withdraw cash from the ATM the Wednesday before the U.S. Thanksgiving holiday for their Christmas Black Friday shopping needs and every Wednesday for their weekend endeavors. Backed by ATMIA, the campaign is also designed to educate consumers about the benefits of cash such as using it as a budgeting tool, reducing debt and saving money by not having to pay credit card interest fees and saving time at the checkout.

You can learn more about WCW by visiting the website and cash blog.


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