Australia leads the world for contactless payment but cash still king for small transactions
Wednesday, June 4, 2014/
Less than 1% of Australians like to make small purchases on card despite the move towards contactless technology, according to a survey published yesterday by business intelligence company RFi.
The survey results reveal while Australians are the highest per capita users of contactless payment technology in the world, with 43% using the technology on a regular basis, we do not use the cards for small transactions.
This has much to do with the reluctance of small business owners to adopt contactless technology because of the charges associated with electronic transactions. Many businesses which do allow customers to buy cheap items electronically often add a surcharge on top of the purchase, intended to offset the eftpos charge.
Businesses in New Zealand do not get charged for card transactions, making the technologies more accessible to Kiwi shoppers – according to the survey, almost 43% of Kiwi shoppers say they prefer using card over cash for small transactions.
“It’s an issue that any retailer has to consider – you can’t really add 10c on a cup of coffee,” says Peter Strong, executive director of the Council of Small Business of Australia.
Strong told SmartCompany despite the charges making contactless tech unattractive for shop owners, it’s just a matter of time until small businesses jump on board.
“It’s the ease of transaction. Australians are really good at dealing with change, that’s the nature of our society,” he says.
“We just need to make sure the change doesn’t impact on business in a way that isn’t good for the economy.”
Dr Warren Harmer, chief executive of small business advice consultancy Crecer Business Solutions, says small businesses have much to gain in adopting cashless payment technology.
“It’s certainly efficient. The big advantage is that people can spend more spontaneously… It makes [customers] more likely to spend money they weren’t intending to,” he says.
Harmer says while some electronic transactions may take longer to clear depending on how the customer pays, the move towards instant online mobile payments will make life much easier for some businesses.
“Now that there are a lot of mobile payments available, you can take payments on the spot, and that streamlines the whole process. It’s enormously beneficial for cash flow and efficiency,” he says.
Be honest about your situation: How vulnerability helps businesses thrive Sue Parker DARE Group founder
Own it: The 10 things you need to do to manage your personal brand Lisa Stephenson Who Am I Projects founder
Six invaluable lessons: What 20 years in aged care taught me about being an entrepreneur Natasha Chadwick NewDirection Care founder
An entrepreneurial superpower: Eight tips to help develop resilience Adala Bolto ZADI Training co-founder
Going through a lull? Five areas you should invest in when sales drop Tamara Alaveras and Sonia Majkic 3 Phase Marketing co-founders
Stop telling us how busy you are, it's boring and charmless Ian Whitworth Scene Change co-founder
Blandification™ and the state of modern branding Jeffrey Oley The Offices co-founder
Why you should find the right role for the right person — not the other way around Bruce Stronge Outfit founder