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"Sorry, we don't accept cash here." Parents, are your children ready for a cashless society?

Updated: Jun 30

How likely would this situation be in Singapore?


If you had asked me this 5 years ago, I wouldn’t have believed that our society could manage without cash. Back in 2015, Singaporeans were still loyal to cash with 60% of their transactions paid off in cash.


However, this may not be as far-fetched as we think. Transactions with cash have reduced by one-third to 40% in 2017, with an expected 5% decrease year-on-year. With better cashless alternatives around, Singaporeans are gradually finding less need to carry cash around.



With the recent COVID-19 situation, we can see an increase in advocacy for cashless and contactless payments. Local bank, DBS, reported that the number of cashless transactions had doubled compared to the previous year during this global pandemic as more people started spending online. From these trends, we can see that Singapore is on track to achieving its goal of reducing the reliance on cash and being a cheque-free country by 2025.


Nationwide initiative


Government organisations and banks have been leading nationwide campaigns to promote digital payments. A notable example is the implementation of a standardised QR code, Singapore Quick Response (SGQR) code in 2018 to enable scan-and-pay services. With SGQR, more forms of e-wallets such as DBS PayLah! and GrabPay are now accepted by merchants. Vendors would be receiving the money directly into their account, thus saving them the trouble of physically depositing the cash into their savings account.


In reality, some businesses in Singapore such as Wild Honey and Black&Ink cafe have already taken a stance by not accepting cash payments.

Source: OpenRice SG (Black&Ink) and Straits Times (Wild Honey)


This does not apply to only the “newer” businesses. Under the Fortitude Budget announced by our Minister of Finance, Heng Swee Keat, earlier this May, $50m has been set aside for the Digital Resilience bonus which aims to digitalise food and retail sectors. Particularly through using advanced solutions such as receiving e-payments. This includes our local food scenes such as hawker centres and coffee shops.


Sooner or later, we can expect to transact without needing hard cash. Even buskers accept peer-to-peer transactions for their performances these days.



We are clearly going cashless, then how are Singaporeans responding to this movement?


A study by the Singapore Department of Statistics found that the proportion of households with online expenditures have doubled from 2012 to 2017 with 60% using digital payment methods for their transactions. More households are also in favour of going cashless, with 80% adopting e-payments as their means of payment. Merchants are also receptive of cashless payments, with 60% accepting this method of payment. This number has shown to have increased significantly since then.


Businesses are adapting to alternatives around them because they see the rise in preference for cashless payments. Out of the places that you visit now, can you count the percentage of them without other options of payment?



Why should we adopt cashless payments?


Fun fact: Did you know that Singapore has been striving towards a cashless society since the early 1980s? The government felt that with a digital economy, our society can become more productive which will, in turn, benefit its citizens.


Here are some reasons as to why one should adopt cashless payments.


1. Convenience

Top of the bat, convenience is one of the key reasons to go cashless for. Apart from only needing one device - your phone, or a card when you shop, there’s no need to bother with carrying around any spare change any more. These coins usually end up spoiling your wallet anyway.


We see the self-checkout machines in big groceries stores like NTUC Fairprice to fast food chains such as McDonald's allowing consumers with cards to independently check out and order their goods, saving them time from queuing for just a few items. With the ongoing pandemic, more stores have encouraged customers to pay through contactless payments.



2. Hygiene

A study by a senior lecturer and researcher Simon Tan, from the Singapore Polytechnic’s School of Chemical and Life Sciences, found that:

“Notes carries as much bacteria as found on the soles of shoes and on toilet seats.”

We wouldn’t use our bare hands to wipe toilet seats but we would pass cash to cashiers and our beloved family members, are we under-estimating the hygiene of these notes and coins?



Some people do not see how a piece of paper/plastic could be a possible mode of bacterial transmission, as it is, after all, valuable money. It is only with the rise of the coronavirus that further highlights how hard cash can pose a danger to the ones who are reliant on them. With the same monetary value behind digital and actual cash, using cashless payments can offer the same benefit at a lower opportunity cost.


3. Security

When you carry less cash on you, you reduce the risk of your valuables being stolen. Most companies with cards offer you the option of cancelling or restricting your card usage when it is lost or stolen. Most cards also have a maximum transaction limit requiring your signature for any greater amount. This helps to ensure the safety of your money, as compared to cash. If your cash is lost, it’s very hard to trace it down.


From a different perspective, when using cashless payments, all transactions are recorded and can be traced to its original source, you can better account for where your hard-earned money goes.


What if someone hacks into my account? Then I’ll lose all my money?!

Ahh, the biggest worry in our 21st century.


With rising digital transactions comes concerns revolving around e-payment risks. Singapore has placed extra emphasis to ensure that along with their Smart Nation initiative that these security risks are taken care of too. The Payment Service Bill (2019) was introduced to help safeguard consumers from potential risks by having payment service providers to abide by the regulations.


4. Awareness/Insights

With all transactions recorded, it provides you with insights into your expenditures which in turns assist you in budgeting your money better. By offering an overview of your expenditures, these e-payment platforms allow you to understand your spending behaviours better. Have you ever noticed how much you spend getting that bubble tea fix? It’s hard to process how much you spent until you see it for yourself.


Give me more bubble tea!


With the invisibility of cash, knowing how to manage your money is more crucial than in the past. A wave of the card, or a scan of the code, and the money is transferred!


You almost don’t feel the pain of money leaving you because it is no longer tangible until your bank statements roll in in red. Therefore, make use of your recorded transactions to properly understand how your money is coming in and going out.


5. Productivity

With cashless payments, the administrative burden needed to account for your spending can be minimised. No more counting of your money to ensure that it tallies up. The beauty of cashless payments, as opposed to cash, is that every dollar and cent is accounted for and credited for. A $15.72 refund means you get exactly $15.72 back.


Automated processes like GIRO reduce our need to head down to the bank in person to settle payments as well, saving us time which can be better invested in other areas of our lives.


6. Rewards system

Underlying these cashless systems are organisations looking to retain their customers.


How do they do it?


Many banks and digital payment platforms offer attractive loyalty programmes as well as cashback systems with partnering merchants to reward their customers with exclusive discounts. As consumers, we definitely benefit from saving a little money just by using their payment platforms.


A smart strategy by companies Fave and Grab - who had partnered together to offer cross rewards across their platforms to better retain customers within their payment ecosystems. As a customer, it would entice me to diligently observe my points and make full use of my rewards and increase my savings.


Read also: Tips to save more while shopping online


7. Lagging behind

Lastly, if Singapore hasn’t made their move towards cashless clear enough, people will have to be more flexible in adopting cashless payments. Those who are rigid in their beliefs that cash is still the better option will lose out on the advancement of society.


Count yourself lucky to have read up on the trends of how Singapore is going cashless. As the nation changes to be more receptive to alternative payment methods, we should take this opportunity of transition to change with times.



There are definitely disadvantages that accompany the transit to cashless payments such as loss of privacy and the invisibility of money. But fear not as we are moving towards cashless as a society, and the government is spearheading a path for us to navigate it better. #SGUnited


While we have been able to go along with the transition from cash to cashless, our children are going to dive headfirst into a cashless society. They may not be well equipped with the skills needed to navigate the realm of cashless payments. They might never have the experience of handling hard cash and knowing what it is like to not have enough for the rest of the week.


They may also grow nonchalant to the constant change of digital numbers.


Thus, it is imperative for our younger generation to appreciate the value of money by experiencing how to manage their own finances. With Taby, we believe in experiential learning and the importance of cultivating good saving habits.


Taby aims to provide teenagers with the ability to be independent in managing their pocket money and using cashless payments in a controlled environment with guidance from their parents. If you resonate with us, join our waiting list (below) as we promote digital financial literacy to our teenagers.


In 5 years' time, when you queue for your favourite hawker stall, “Sorry, I didn’t bring cash today.” will not become a problem.


* cash is referred to as hard cash

** illustrations courtesy of Jia Yue

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