Have you ever wondered how buskers, bellboys, charities and Big Issue sellers will get on in the digital age? Contactless makes paying for things quicker and easier than ever, but it could mean members of the public carry around a lot less loose change than they used to.
Change, or change?
Millions of people work in jobs where wages are topped up by tips, while charitable organisations rely on quick access to cash for spontaneous donations, whether they be coins and notes dropped into a collection tin on a newsagent counter or flipped into an open guitar case at a busy train station.
So with monthly contactless spend surpassing £1.5 billion each month in 2016 according to figures from the UK Cards Association, you’d be forgiven for worrying about the impact on people who rely on cash donations to get by.
The Charities Aid Foundation says two-thirds of people are most likely to use coins and notes when they back good causes, a figure which likely also applies to nightclub toilet attendants, hotel staff and takeaway delivery drivers — so won’t a big chunk of society be starved of a trusted method of giving?
The busker experiment
It’s a challenge that the payments industry has been working hard to address. As far back as the summer of 2010, before contactless payments became widespread, Barclaycard created a UK first by enabling a street performer to become a cashless busker.
While Peter Buffery entertained crowds in London’s Soho Square, passers-by were invited not to throw change, but to tap cards on his specially-modified guitar. The cards were issued by Barclaycard and listeners held them over the head of the guitar to make a £5 donation, with the proceeds going to Help a London Child.
The giving revolution
Contactless technology is paving the way for new and easier ways to give generously, smoothing the path for people to bolster charity coffers rather than creating an obstacle.
In 2014, London’s commuters got the chance to make micro-donations every time they travel on the Transport for London network. Penny for London works by automatically collecting between one and ten pence, as set by the commuter, whenever they use registered credit or debit cards to pay for journeys on Tubes, buses and trams, as well as National Rail services accepting contactless payments. The scheme supports a range of the capital’s charities including Cash for Kids and The Prince’s Trust.
Further evidence is in the Royal British Legion’s Poppy Appeal, which has been working to find new ways to tap into the generosity of Londoners. With spare change becoming scarcer, 150 card terminals were set up in 70 Tube stations in the capital.
Although contactless payments were still a novelty to many when the scheme began in 2014, they still managed to produce £1000 an hour at their peak. 2015’s appeal was even more successful, with £65,000 donated in a single day.
Big challenge, small scale
What about giving closer to home? Cash is still king when it comes to small-scale fundraising. So while people might still be happy to pay a few quid for entry into a church fête, a cake at the school bake sale or a copy of the Big Issue, they’re less likely to have the change as our love affair with contactless grows.
This gives payment providers a chance to offer small charities and one-off fundraising events more flexible ways to accept payments that are easier to access, install and use than those designed for permanent retailers.
The giving revolution… continued?
Take ToneTag. Designed to work on any Android phone, ToneTag uses special sounds containing encrypted payment information to make and receive payments. The app was a response to the needs of rural India, where the need for specialised technology to accept payments made it difficult for merchants to accept anything other than cash – the exact problem faced by the charitable sector.
Whether through easy-to-access hardware and software, or making it easy to become a merchant even for a one-off event, flexibility is the key when it comes to cashless charitable donations – or for anyone relying on spontaneous donations or tips, including delivery drivers, toilet attendants and buskers.
So, with such a big opportunity on the table, will it be an established payment provider or a fintech start-up that sparks a revolution in charitable giving?