What will the future of retail look like in an increasingly cashless and digital society?
On the podcast episode of “Inspired Retail,” host Tyler Kern talked with Michael Graham, the vice president of Banking Solutions and Strategy for Hyosung America. The two chatted about how the shift from cash to cashless is impacting the future of retail. Hyosung America is an ATM servicing company that is a growing leader in the ATM industry, and naturally, the company is a front seat witness to how these changes are happening and what to expect next.
Kern said that the use of cash has dropped tremendously due to the transition to digital for many consumers. And this fact can be proven to be exceptionally glaring on any given day by simply questioning the amount of legal tender they both have in their wallets, stated Graham.
“There’s probably not a ton between the two of us, and I think that just kind of represents a lot of what’s happened over the last decade,” said Graham. “Obviously this trend towards digital … we continue to see this downward traffic trend from a physical perspective.”
With less cash being circulated comes concerns about the direction this could all be headed. This concern was further extrapolated at the height of the COVID-19 lockdowns. With more people at home than before, online shopping saw an exponential increase.
But Graham added that online shopping and quick delivery options benefit consumers in a way that has created a new cultural phenomenon. This along with the integration of digital payment options in retail stores creates less use for cash. As a result, it’s reduced cash circulation. On the contrary, cash remains a fundamental aspect of society that will retain a base of preferred uses and users.
“People are returning to physical brick and mortar … but cash is still needed and we still see this need for cash,” he said.
And even legislators agree. To ensure cash is being used and accepted in retail Congress passed the Payment Choice Act, making sure that all retailers accept cash in some way given the increasingly common ‘card only’ trend.
Graham said that this will be of benefit to consumers who do not have banking. He added that a segment of the consumer population has been ignored by banking institutions who favor mobile banking. These consumers, he said, are “unbanked and underbanked,” and how digital banking does more harm than good for these groups despite them helping the flow of cash usage.
Cash being used in retail does come at a cost for the retailer because staff is needed to handle, manage, and secure all cash coming in and out. It also helps retailers focus on other priorities in growing the efficiency of their business, stated Graham.
Nonetheless, Graham also stated that transactions under $50 and certain services such as landscaping have always relied on a cash payment. Those cash-preferred instances have more permanence.
At Hyosung, Graham cited that the company particularly focuses assisting retailers with cash solutions at their locations, and also coming to a full understanding of their specific needs for improvement. He said that this varies in small businesses and big retailers.
“As we’ve developed solutions, they’re really the result of customers telling us, ‘This is what we’re looking for,’ and Hyosung has really prided itself in being around customizing what the customer is really asking for,” said Graham.
Hyosung has a dedicated network specifically to work with retailers, and offering the best solutions to them.