October 24, 2019
Some apps give discounts and let you skip the line. But is that really fair?
When visitors drive over the Golden Gate Bridge in San Francisco to get to Sausalito, they find that technology has taken over.
The toll booths and their operators are gone.
Now, people are expected to drive through and pay their toll within 48 hours via credit card. Officials direct you to pay either at a website or by calling in the numbers by phone. If you insist on going "old century" and paying cash, officials direct you to a handful of stores in the city to pay in person.
Analog customers are now often being sent to the back of the line when it comes to payments.
Chains like Chipotle, McDonald's, Starbucks, Coffee Bean and others let you order via the smartphone app, skip the line and head straight to the register to pick up your meal. And you generally can't complete the order unless you pay for it within the app, by credit or debit card.
Several retail stores have ditched accepting cash. California-based restaurant chain Tender Greens will accept only credit cards or paying via mobile. Amazon has launched the Go stores, where you need the Amazon app to enter, and payments are handled through the app in most locations.
Is the app generation and push to go cashless fair to those who don't have credit or just prefer paying cash?
We asked some of the members of our Talking Tech text subscribers to weigh in.
"Unfair," says Grace Dunn, who lives in Tulsa, Oklahoma. There are a variety of reasons that someone might not be able to pay digitally, as well as "they may have forgotten their phone."
Monika Thormann of Bloomington, Illinois, notes that her aunt and uncle don't have cell phones. "They've tried a couple times, but don't end up charging them or break them."
Generationally, there's a notable gap in who even has a smartphone. While more than 93% of millennials and 90% of Gen Xers own smartphones, only 68% of Baby Boomers and 40% of the Silent Generation (ages 74 and up) do, according to a Pew Research Center survey of U.S. adults conducted in early 2019. The oldest adults face obstacles to adopting new technologies—from a lack of confidence with new technologies to physical challenges using the devices.
And then there's the shift toward apps like millennial favorites PayPal's Venmo and Square's Cash, which allow users to transfer money to one another with the tap of a screen.
But even with more than 40 million people now using Venmo, its use is not ubiquitous. Cheryl Wakschlag of Silver Spring, Maryland, doesn't have the popular Venmo app, which many vendors like to use as an alternative to payment programs from Apple and Google because no fee is involved in the transaction.
"Since I do not have Venmo, I was frustrated when my hairdresser only let me pay with cash or Venmo, and not credit card or check," she says.
This digital shift toward app-based rewards and payments shuts out the millions of Americans who don't have a bank account, lack credit or debit cards or don't have photo identification. Some 6.5% of U.S. households in 2017 didn't have bank accounts, according to the FDIC. Communities of color are particularly affected. Among African-American households, 16.9% were unbanked in 2017, the most recent year available, and 14% of Latino households did not have a bank account, according to the FDIC.
In response to the cashless movement, several states have outlawed the practice, saying businesses had to continue accepting cash.
But David Schwarz of Middletown, Connecticut, says the move to smartphone for payments is "more than fair. Don't know anyone without a smart device. Get with the progress."
Sure, that progress can leave some locked out generationally or economically or left out of the benefits, perhaps, because they prize privacy over a deal. But it's worth noting that companies and apps may come away with more from the arrangement, getting a great deal of information about your purchasing habits, data that can be worth its weight in gold.
Of course, cash still does remain king in one popular retail location: Gas stations still offer hefty cash discounts for paying with green. In Los Angeles, where gas now averages $4 a gallon and up those discounts are very pronounced.
And the Arco, 76 and Mobil stations selling you gas don't know your name, address, demographic or any other personal information, so if privacy is important to you, cash may be your best friend.
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