A September 2020 study of 12,000 people across 12 markets – Hong Kong, India, Indonesia, Kenya, Mainland China, Malaysia, Pakistan, Singapore, Taiwan, UAE, the UK, and the US – found that two-thirds of global consumers expect their country to go fully cashless, with almost half expecting this to happen by 2030. This is a significant finding for businesses and investors.
Here’s a closer look at the state of cashless spending and tipping:
- Two-thirds of those who partook in the above-mentioned survey said they preferred to shop in-person before the pandemic compared to only one-third online. Now, almost half prefer online or touchless payments. In countries like the U.S., studies show that most Americans believe in touchless payments and that businesses should adopt these kinds of solutions to help slow the spread of COVID.
- The preference for touchless and cashless payments is increasing across a range of purchases, from groceries to travel. A November 2020 study from Mastercard found that 51% of Americans are now using some form of contactless payment, which includes tap-to-go credit cards and mobile wallets like Apple Pay.
- Tipping is one of the primary reasons consumers still carry cash. In the U.S., 45% of Americans say they carry cash specifically for tipping service workers like hotel staff. That leaves most travelers without cash for tipping, representing a big business and investment opportunity. Some hotels report as many as 40% of guests who don’t have cash asking if there are alternative ways for them to tip workers using their phone.
- There are major differences in tipping between generations. One study found that less than one in five Millennials tip hotel bellhops and bag carriers compared to about 25% of Generation X and 40% of Boomers. This percentage is expected to be even lower for Gen Z, which will drive the future of spending and tipping. This group (those born between 1997 and 2012) now represents the largest generation and 32% of the global population.
Could the world become cashless by 2030? There are plenty of good reasons to go in this direction. eTip represents a significant part of this movement, recognizing the fact that travellers want an easy, secure, and contactless way to tip the hotel workers who serve them. Learn more about what we’re doing at eTip here.
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