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"People are living longer, so we're seeing Boomers still having a strong influence Cash usage and cash discounting
on the retail industry," he wrote. "And millennials are just coming into their full
purchasing potential." While grab-and-go shopping has grabbed headlines, it's Despite the proliferation of card-
only one of several possible paths. Retailers who take a "single-vision approach" based payment options (includ-
to in-store technology could well alienate parts of their customer bases, he ing mobile), cash remains a pre-
added. ferred method of payment in the
United States and most countries.
Amazon apparently understands this. Amazon Go is live in just one city, and Merchants understand this, as evi-
according to news reports, the company isn't planning to move anytime soon to denced by recent interest in cash
cashier-less shopping for Whole Foods, the grocery chain it purchased last year. discount programs, which reward
customers with discounted prices
when they pay with cash rather than
using their credit cards. Sure, the
main attraction is the lower cost of
acceptance vis-à-vis credit cards,
but merchants wouldn't be pursuing
these programs if they didn't think
consumers liked using cash.

In 2016, just over three in 10 consum-
er purchases (31 percent) were made
with cash, according to a Federal Re-
serve report on consumer payment
choices. Debit cards made up 27
percent of consumer purchases, and
credit cards were used for 18 percent
of purchases. The average value of
consumer cash holdings that year
was $57, the Fed reported.

More recently, the Bank for Interna-
tional Settlements reported that de-
spite the proliferation of cards and
other electronic payment options,
demand for cash has increased since
the financial crisis of 2008. The trend
is particularly notable in advanced
economies, like the U.S. economy.
In a report aptly titled Payments are
a-changin' but cash still rules, BIS at-
tributed the trend to persistently low
interest rates on deposit accounts
which discourage consumers from
banking their cash holdings.

I also believe cost is a consideration
for merchants and consumers. Many
consumers are debt averse, prefer-
ring not to rack up finance charges.
Meanwhile, many merchants are
looking to save on interchange. It's
a powerful combination of attitudes
that I see driving merchant and con-
sumer interest in cash discounting
programs.
Patti Murphy is Senior Editor of The Green
Sheet and President of ProScribes Inc. Follow
her on Twitter at @GS_PayMaven or email
her at patti@greensheet.com.
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