People have been writing cash’s obituary for well over a decade at this point, forecasting the day when paper transactions of all kinds will be no more, replaced by more efficient digital mechanisms. And, given the preference for contact-free transactions inspired by COVID-19, it could well be the case that cash is on the way out.
But people need to be careful about writing off cash, Blackhawk’s Head of Global Commerce Brett Narlinger told PYMNTS in a recent conversation — because cash isn’t going anywhere, at least not anytime soon. While cash is no longer king in the U.S., having been superseded by credit and debit some time ago, it is currently the No. 3 payment method in the U.S., and half of all payments under $10 are still happening in cash. The goal, he said, shouldn’t be to kill off cash, but to find a way to make it a more functional part of a rapidly digitizing economy.
“If I were to ask people if we want to disenfranchise a large group of consumers and not be able to solve their problem so they can shop, people would think that was crazy,” Narlinger said. “But to include cash customers, we need to create products and solutions that allow our retail community to put cash onto the digital highway in a meaningful way. They absolutely want to have that consumer bring that cash in, bring it to the point of sale, put it into their digital wallet, buy more groceries, buy more food, and buy more and spend more time at that store.”
For customers, during the COVID-19 period, their concerns have come down to convenience and choice: choice in what merchants they go to and in how they shop, and convenience in terms of how many separate stops they have to make. And Blackhawk is invested in making that easy and accessible for the consumer, leveraging the magic of the QR code.
Scanning The Future
With a simple scan from any smartphone camera, said Narlinger, the consumer can load funds onto a card or digital wallet, and convert their cash into a digitally usable form. This technology allows retailers like grocers to offer that one-stop option consumers want, while stepping up to fill in one of the remaining physical-digital gaps.
And Blackhawk’s research demonstrates that consumers are rewarding retailers for making that choice. Some 68 percent of consumers reported that they would shop in the store more often than they normally would if they could bring cash into their digital wallets, while 57 percent said they would spend more money at the store than they normally would if a digital cash option were on the table.
“This all comes down to realizing that not all consumer choice and consumer behavior is the same,” said Narlinger. “People want personalized solutions and choices, whether that means how they are spending, how they’re depositing, how they’re utilizing their wallets or how they’re tapping into different types of accounts. That’s what the retail community needs to embrace.”
That’s why Blackhawk is working with Venmo: to make it easy for consumers to use a QR code to access the funds in their Venmo account at the point of sale. And it’s why they invested in efforts at digitizing paper coupons — again leveraging QR — so they can be easily accessed at checkout and personalized to their users’ actual needs.
QR codes, which have been around for a long time and have often been overlooked as higher-tech payment methods took up more of the conversation, are coming into something of a golden era as consumers are becoming more familiar with them, Narlinger said. That creates the ability to stage exactly the transaction one is looking for, in a way that can be read by virtually any POS.
The technology enables Blackhawk’s Pay4It Suite, which in turn enables things like ScanIt, which allows consumers to pay cash to purchase a digital gift card. Blackhawk’s Pay4It suite also has a solution that converts cash to a digital wallet and enables the ability to capture balances trapped in digital wallets and loyalty programs to be used in everyday transactions online and in-store.
“In the QR code, we’ve finally figured out that we have something on our phone that can translate into payments in a real-time way,” Narlinger said. “It allows for a really interesting interaction between the consumer and the retailer, and I think we’re going to see that the QR code is the glue that brings all of these digital interactions together.”
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