Is Cash Still Necessary?

We have brought this up before but we are headed towards a cashless society. It may seem inevitable but every now and again there are events that make everyone pull back and say that it may not be such a good idea just yet. If you are a merchant that accepts forms of payments other than cash or check you depend on technology working, not only at your business but also behind the scenes. When that does not happen, you and your customers lose.

Frustration At Target

This past June customers at Target found that they were unable to make payments via their credit or debit cards. It happened on a Sunday, which is a popular day for shopping at the retail giant. For 90 minutes payments were unable to be processed nationwide and customers were faced with little recourse other than stand in line and wait or abandon their cart and leave. 

The problem stemmed from an issue at the National Cash Register (NCR) data center, which caused the outage. This was not good timing for Target as the company had suffered another outage (not related to NCR) the previous day that affected its stores around the globe. 

What Happens When Automation Breaks

NCR is used by Target (and many other retailers) to accept credit card and debit card payments. With that service down they could only accept payments with cash or with gift cards. Obviously many people were unhappy and vented their frustration on social media. Some even speculated that it could be another data breach, which Target went out of its way to tell everyone it wasn’t afterwards.

The methods that are used to make payments are becoming increasingly automated. Fewer people are handling the transactions and while that has its benefits when the automation breaks down there is very little that can be done except to wait until it is fixed. That is frustrating for both the customer and the merchant as the wheels of commerce grind to a halt. 

Rare But They Do Happen

Fortunately these instances have been rare but they still happen. Most IT systems seek 99.9% uptime with the only downtime coming during off hours when updates are processed. When something goes wrong during the day it is a serious problem like a hardware failure. If that happens and you don’t accept cash you could be left hanging and so could your customers. It is always nice to have cash as a backup, if just for a situation like this. 

As a payment processor we certainly don’t want to steer anyone away from accepting forms of payment like credit and debit cards but we do want to make sure that our clients are aware that things like this that are out of our control can happen. Technology is wonderful when it works and extremely frustrating when it doesn’t but we need it to run a modern economy. There are risks that come with that as no system is perfect so maybe just keeping a little bit of cash on hand is not such a bad thing.