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AUSSIE BUSINESSES NOTE CASHLESS GROWTH SPURT A new report from payments company Square reveals that Australian businesses have experienced a “cashless growth spurt” amid the coronavirus pandemic, with one in three businesses effectively turning cashless over recent months. The report, ‘Cashless payments and the pandemic in Australia’, reveals how Covid-19 has changed the way we buy and sell with cash. “As the Covid-19 pandemic began to sweep across Australia, so too did health and safety concerns among business owners,” Square Australia Head of Business Development Colin Birney said. “This raised questions of how to properly conduct business and accept payments during social distancing and stay-at-home mandates. The result has been a significant shift by many Australian businesses away from cash, although we’ve seen variances across industries and in different parts of the country.” Crunching the numbers from millions of transactions at thousands of Square businesses nationwide between January and June, the report found that the biggest drop in cash use across the country was in April. Of the states and territories, the ACT saw the most substantial abandonment of cash, with cash payments plummeting there from 42 per cent of transactions in January to just 14 per cent of sales during April. Tasmania, South Australia, and Victoria weren’t far behind, with cash sales in those states also dropping by more than half over the same time period. The Northern Territory remained the most committed to cash, with around one in five Territorians (19 per cent) still opting to pay with physical money during the peak of the pandemic’s first wave. From an industry perspective, charitable organisations have shifted most dramatically away from cash, with donations made in cash dropping by more than half, from 46 to 23 per cent. Cash payments at cafes and restaurants also dropped by more than half, from 36 to just 14 per cent. Professor Steve Worthington from Swinburne University Business School in Melbourne says the ongoing pandemic is only serving to sharpen the shift seen over recent years, where consumers and businesses are increasingly prioritising digital forms of payment. “There are a number of factors contributing to the steep decline in cash use as a direct response to the pandemic,” he said. “For consumers, fears over social distancing and a preference to minimise contact with physical currency is likely to be top of mind. What’s more, with banks closing branches and reducing operating hours, and fewer ATMs available, there’s less cash in circulation. Combining that with the fact that many businesses favour digital payments for speed and security, there’s less incentive now for any of us to carry cash.” Locally, many business owners have also opted to make the choice for their customers, turning operations effectively cashless in a bid to keep their staff safe. NEWS PREPAID MOBILE PHONES GAIN ‘SATISFACTION’ EDGE Prepaid mobile phones have overtaken their post-paid counterparts in customer satisfaction, gaining a higher rating for the first time, according to new data from the ‘Roy Morgan customer satisfaction report on mobile phone service providers’. The change in the market has come over the past year, the report says, with satisfaction for prepaid mobile phones increasing to 76.8 per cent in March, up 3.7 percentage points from a year previously in April 2019. Over the same period, satisfaction with post-paid mobile phones declined two percentage points to 75.6 per cent. The increasing satisfaction with prepaid mobile phones, says Roy Morgan, goes hand in hand with more Australians choosing this type of phone: 33 per cent of surveyed Australians now use prepaid mobiles, up from 30.3 per cent in 2017. Prepaid mobile phones are a big part of the business plan of third- party providers such as ALDImobile, TPG and Boost, which fill the top three spots for the latest monthly Roy Morgan Customer Satisfaction awards. ALDImobile leads the other providers, with a customer satisfaction rating of 90 per cent. Most Australians, however, still use post-paid mobile phones, at 56.8 per cent, but this is down 0.7 per cent points from 57.5 per cent in 2017. Roy Morgan CEO Michele Levine says the Covid-induced recession may accelerate the trends the company has identified in Australia’s mobile phone market. “We highlighted the trend of Australians turning to prepaid mobile phones a year ago and this trend has continued,” she said. “Now 33 per cent use this type of mobile plan and, importantly, satisfaction with prepaid mobile phones has overtaken the more widely used post-paid for the first time. “Prepaid mobile phones offer consumers greater control over their spending. The onset of Covid-19 has plunged Australia into its first recession for nearly 30 years and this economic contraction will force many to cut costs and closely watch their spending – including on mobile phone plans. “The high customer satisfaction with third-party mobile phone providers such as ALDImobile, TPG and Boost, which rely primarily on a prepaid model, puts these providers in a prime position in a financially constrained environment.” SEP/OCT, 2020 CONVENIENCE WORLD 17