Gen-X: Crossroads to Cashless?


New York, NY: Here in our little corner of the world, we’ve begun to notice more “This store is cash-free” signs showing up in the windows of our local hangouts. At Sweetgreen, a trendy salad bar chain, a helpful “NO CASH MONEY” sign at the entrance explains that the practice saves on fuel (no armored car trucks driving around huge bags of cash and thereby lessening the carbon footprint), keeps employees safer (no threat of robbery), and the food cleaner (not touching money then handling ingredients).


Judging from the lines snaking out the door, it doesn’t look like it’s hurt business at all.

Neither our local pizzeria nor the closest coffee bar take cash. They’re doing just fine, too. And a few months ago, one of our team flew to Toronto. He remembered his passport, but not his wallet, and managed with just the apps on the phone for three days. When he checked into his hotel, they accepted the photo of his credit card which his wife sent to his smartphone. Other than that, he didn’t need any plastic or any cash at all.

Is cash-free just a weird New York thing, like 24-hour subways?

Personally, I was surprised that it was even legal: There’s that big stamp on our bills: THIS NOTE IS LEGAL TENDER FOR ALL DEBTS. If you can’t trust the US Mint, who can you trust?

So, we asked the rest of the country: Have you ever seen a business that only accepts cards as payment – no cash?

Turns out, just under 4 in ten people have seen such a thing. This was more than we expected, but still not a national trend. It wasn’t just a big city thing, either – the responses were the same regardless of where in the country you were.

The main difference is who you are and where you spend: The younger you are, the more likely you’re acquainted with NO CASH MONEY. Imagine a staircase. At the top of the staircase are young adults (18-24 year olds). Most of them have seen a cashless shop. (Everyone at Sweetgreen looks to be under 30. 34, tops.) At the bottom of those stairs are Boomers (65+). Only about 10% of them have ever seen a cashless shop. Everyone else falls in between, in a neat, descending gradation, from Gen X to Millennials to Gen Y.

Then we wondered: Maybe it’s great for the business, but how can taking one less form of payment be better for customers? It has to be annoying. After all, Maru/Matchbox spends most of its time telling our clients to focus on what the customer wants.

Exactly half of respondents say it’s all the same to them (makes sense), but the remaining half is neatly split (that is, about 25% each) between More and Less convenient. The ratios hold across all generations except – are you ready? — with Gen X.

Almost half (46%) say it’s less convenient when businesses don’t take cash. They’re the only age group who feels this way.

The other thing we noticed about cashless businesses was that they’re places you go every day. They’re not special occasion shops. Almost everyone (76%) prefers to pay for big purchases on plastic, but it was interesting to us that businesses with regular customers were willing to go cash-free.

Guess who likes plastic the most? Boomers. Almost 80% of them prefer plastic for every day expenses – way above 59% for the general population.

The outlier is Gen X – the generation most divided between cash and plastic preferences.

Now, why would this be? Are Gen X particularly sensitive to the threat of hacking? Are they more worried about privacy? When Maru/Matchbox talks to consumers about their spending habits, the one broad consistency we see is that people who have trouble paying their bills say they only use cards when they have to (like online purchases), but for everything else, they have set up envelopes labelled “Groceries,” or “gas” or “rent,” and that’s all they have to spend. When it’s gone, it’s gone. (That’s how my mom did it too, by the way.)

I’m not talking about people who are trying to manage discretionary spend. I’m talking about people who are working, who have income, but still struggle to make the basics. Are there more of these people in Gen X?

As this group (45-54 year-olds) inches toward pre-retirement age, caught between the mass middle class prosperity of Boomers and the employability (“I’ll do your job better and for less”) of Millennials, they are beginning to exhibit some pretty distinct financial behaviors. What about this generation makes them more attached to cash – or less prone to the allure of plastic – than any of the others? We’re going to be talking about them a lot in future.

Send us your theories:

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