Is the World Going Cashless? A Mixed-Methods Study

Andrew Faria

Co-Presenters: Individual Presentation

College: College of Business and Public Management

Major: BS.FINANCE

Faculty Research Mentor: Eli Kochersperger

Abstract:

Cash is universally used around the world, but digital payments such as debit cards, credit cards, and phone apps--such as ApplePay or GooglePay--have become more common in everyday transactions. This raises an important question about whether society is moving toward a cashless economy and how that shift affects economic behavior. The purpose of this project is to investigate the impact of payment methods on consumer spending and how businesses determine which payment methods to accept.

The project uses a microeconomic approach based on consumer choice and transaction costs. Paying with cash requires more awareness because a person physically hands over money, while digital payments are quicker and feel less noticeable. Because of this, the effort of completing a purchase may be lower when using digital payments. If the effort is lower, consumers may spend more often or pay less attention to prices. Businesses must also decide whether to accept certain payment methods, balancing transaction fees with customer preferences.

To examine this, the study will use a mixed-methods approach that includes surveys on the spending behavior of Kean University students and interviews with business owners/managers about how they view cash payments versus cashless payment methods and how digital payment can change consumers' preferences. This approach shows the comparison between consumer payment methods and the viewpoint of business owners/managers on payment preferences.

This research aims to show not only whether cash use is declining, but also how the rise of digital payments changes everyday decision-making for consumers and small businesses. The results help explain how payment technology influences markets at a microeconomic level.

Keywords: cashless economy, consumer behavior, digital payments, transaction costs, payment choice