CONTINUE TO SITE »
or wait 15 seconds

blog

What Visa and Mastercard don't want you to know about cash

Cash is the quicker choice. The average cash payment transaction at the point of sale takes only around 22 seconds, 7 seconds faster than the average card and PIN payment and a whole 16 seconds quicker than a typical card and signature transaction.

What Visa and Mastercard don't want you to know about cashiStock photo


| by Ron Delnevo — Chairman, Cash and Card World

Cash has always been the fastest way to pay for me. Why? First, I can do mental arithmetic, so adding up the cost of the — usually — few items in my shopping basket is not a problem.

I should explain here that my dad ran a shop where I helped out as a teenager. In those far off days, to work in a shop you had to memorize the prices of all the merchandise being sold and be able to add up the total cost of the items the customer was buying.

Second, unlike many people, I get ready to pay before I arrive at the check-out. I have my cash in my hand, primed to exchange for my purchases.

That said, what sometimes holds me up at the checkout counter is the lack of adequate notes or coins in the till to allow me to quickly receive my change. This is very annoying and seems to be a growing problem in the UK, which is odd, because I am told that in countries such as Switzerland, where a 1,000-franc note ($1,012 USD) is still widely in use, all shops and restaurants can readily give change, whatever denomination of cash payment is made.

Perhaps customer service is simply a higher priority in Switzerland than it is in the UK? To be honest, that is something I have always suspected.

In any event, I accept that I am a cash junkie and, as such, I am bound to always find the fastest way of paying with cash. Label me, if you like, the Usain Bolt of cash users, but cash transactions are actually faster, even for shoppers who don't do mental math or arrive at the queue prepared to pay.

If you don't believe me, Deutsche Bundesbank, Germany's central bank, commissioned research in February on the speed and cost of payment method and found that the average cash payment transaction at the point of sale takes only around 22 seconds. That's 7 seconds faster than the average card and PIN payment and a whole 16 seconds quicker than a typical card and signature transaction.

So use cash to save time — not a message we can expect to see in a Visa or Mastercard advertisement any time soon.

Bundesbank's study also revealed that cash outperforms other means of payment in terms of its cost per transaction for merchants. The study singles out cash payments of up to €50 ($55 USD), which it found to be cheaper on account of the lower average fixed cost of cash payments.

According to the study, a cash payment costs 24 cent on average, compared with 33 cent for a Girocard (Germany's national debit card scheme) payment and 34 cent for a direct debit transaction. The highest cost per transaction arises from credit card and PIN payments (97 cent) and credit card and signature payments (€1.04).

So there you have it. Cash is the payment method that satisfies both the need for speed of shoppers and the cost requirements of merchants. My thanks to the Bundesbank for proving what I have always instinctively known — cash is the best choice for everyone. 

INCLUDED IN THIS STORY

ATM Industry Association (ATMIA)

605.692.2263


The ATM Industry Association, founded in 1997, is a global non-profit trade association with over 10,500 members in 65 countries. The membership base covers the full range of this worldwide industry comprising over 2.2 million installed ATMs.

LEARN MORE
REQUEST INFO FROM SELECTED SUPPLIERS

REMOVE ALL

Ron Delnevo

Ron created the U.K. IAD Bank Machine in 2003 and led the company until 2012. In March 2014, he took up the role of executive director for the ATM Industry Association in Europe. Ron has a special focus on supporting choice in payment methods.


KEEP UP WITH ATM AND DIGITAL BANKING NEWS AND TRENDS

Sign up now for the ATM Marketplace newsletter and get the top stories delivered straight to your inbox.

Privacy Policy

Already a member? Sign in below.

  or register now

Forgot your password?


You may sign into this site using your login credentials
from any of these Networld Media Group sites:

b'S2-NEW'