By: 30 April 2024

PayComplete’s ‘The Cash Chasm’ report reveals cash is here to stay

57% of businesses expect to never be fully cashless

Cash is here to stay, with nearly 6-in-10 businesses (57%) expecting to never be entirely cashless despite the widespread adoption of electronic, card and mobile payments. This is according to The Cash Chasm, a new research report from global cash management solutions provider PayComplete which surveyed cash processing and management decision-makers within the retail, hospitality, and leisure sectors from across the world, to assess the status of cash management.

However, regardless of cash’s staying power and continuing popularity with consumers, many businesses are still stuck with out-of-date manual processes for handling, storage, counting and reporting cash that create huge inefficiencies that literally leaves ‘money on the table’. In a surprising revelation, it has been found that 41% of companies still use manual cash-handling processes, leading to many businesses spending over £400,000 a year on excessive security costs which could be slashed with the introduction of new CashTech solutions.

Cash crashes the payments party

Globally, cash usage remains resilient, with estimates of $40trn of physical cash in circulation. Despite many expecting cash use to disappear following the COVID-19 pandemic, quite the reverse has happened. For example, the amount of US dollars in circulation as cash has increased, while in Germany it remains a strong cultural preference. Even in the UK, a region at the forefront of payment innovation, has seen the Financial Conduct Authority (FCA) announce the need for new legislation to enshrine access to cash in law.

“Cash is alive and kicking in the 21st century. However, organizations aren’t giving it the attention it deserves. Just as card payments evolved from low-tech systems like pen-on-paper slips to magnetic stripes and now fully interconnected electronic systems, cash is having its own digital revolution,” said Simon James, chief executive officer of PayComplete. “Previously cash management advancements relied on new hardware being deployed, but this piecemeal approach has created fragmented, Frankenstein cash estates that are inefficient and reliant on manual processes. It’s time for a new digital attitude to physical cash.”

Highlights from The Cash Chasm report include:

  • Over-reliance on manual processes – 41% of organizations admit to having an entirely manual cash handling process. This figure jumps to nearly two-thirds (62%) in France, which lags behind the global average.
  • Irritating inconsistencies – Over a third (34%) of organizations say their biggest challenge is discrepancies when handling and processing cash due to low levels of automation. France (54%) and Spain (43%) are the regions with the biggest discrepancy issues.
  • Vanishing value – A shocking 20% of the value of cash is lost for organizations with 3-5 people handling cash.
  • Going against the grain – More than one in three (35%) organizations encourage buyers to use electronic payment methods to increase overall efficiencies, despite cash remaining a strong customer preference for payment.
  • A band-aid on a broken leg – 31% of organizations are tightening processes and increasing staff training to offset their lack of automation, further increasing unnecessary operational expenditures.

This lack of automation is having a major impact on business operations leading to issues including cash discrepancies, security worries, and high cash management costs, which were ranked as the top three cash handling and processing challenges.

High costs due to inefficient processes are a massive concern for businesses. Research reveals that when over six people are involved in cash handling, the cost of security measures increases by over 380%, to an average annual cost of over £409,000. By reducing the number of people involved in cash handling, businesses can slash their operating costs while simultaneously reducing losses from risk, fraud, and theft by an astounding 280%!

Closing the chasm with CashTech

Simon continued: “Only a few (27%) forward-thinking businesses have fully automated their cash reporting with CashTech systems. This lack of automation when it comes to cash holds organizations back from reaching their full potential. Cash management has left the Stone Age and entered the Digital Age. While some organizations are looking to steer customers down the route of cash payments due to their efficiency, the report reveals how others are looking to develop a dual strategy where the cash management processes are reviewed holistically and optimized with new technology to achieve levels of efficiency that have previously only been associated with card payments.”

PayComplete is at the forefront of modernizing cash management for the 21st century. With its cutting-edge systems and proprietary hardware, coupled with a manufacturer-agnostic cloud-based platform, PayComplete is trusted by major businesses across the globe including retailers, merchants, banks, cash-in-transit (CIT) firms, and international mints to automate and provide real-time visibility into the movement of physical cash across their organizations, ensuring more efficient and secure operations.

Simon concluded: “Anyone who thinks cash is a relic of the past is in for a big surprise! But this doesn’t have to be a problem or challenge to overcome. Adopting the latest CashTech solutions to automate and fully connect their cash estates, allows businesses to finally have a complete view of their payment ecosystem that combines electronic and cash payments together.”

Related news: Guillaume Lefebvre on the future of payment technologies

Image: Ibrahim Boran on Unsplash

Robert Welbourn
Robert Welbourn is an experienced financial writer. He has worked for a number of high street banks and trading platforms. He's also a published author and freelance writer and editor.