News | Friday, 29th May 2020
How cashless payments can safeguard the future of the hospitality industry
New research will produce a toolkit for businesses going cashless in a COVID-19 economy
The potential of cashless payments to aid social distancing and transform business models in hotels, bars and restaurants is being investigated as part of a new research project at Manchester Metropolitan University.
Researchers at the University’s Decent Work and Productivity Research Centre will examine the proposed benefits for hospitality firms in ‘going cashless’, such as easier banking, a lower risk of crime, reductions in staffing costs and less staff training.
Cashless payments refer to all payments made without the need of physical money and instead using bank transfer or card payments to transfer money electronically.
Funded by the Productivity Insights Network – a national research network aiming to improve understanding of the factors affecting UK productivity - the project will investigate the role of cashless payment systems as an enabler of social distancing as well as examining the development of new business models in a post-lockdown economy.
Dr Richard Whittle, Senior Lecturer in the Decent Work and Productivity Research Centre at Manchester Metropolitan University, said: “The retail and hospitality sectors will be crucial to the UK’s economic recovery as lockdown restrictions ease. However, these businesses have traditionally relied on physical cash transactions which will be a key barrier to implementing social distancing.
Our research will investigate the role of cashless payments in safeguarding the future of the hospitality sector and consumers as well as its implications for the workforce and the type of effects that this may have on consumer behaviour.
Businesses in the hospitality sector were the first to close when lockdown restrictions were introduced in the UK in March.
Some restaurants, cafes and pubs will be allowed to open again in July with strict adherence to new safety measures including social distancing guidelines.
Manchester Metropolitan’s research will use insights from Greater Manchester hospitality firms to generate wider policy recommendations and will produce a toolkit for businesses going cashless in a COVID-19 economy.
While the short-term aims of the project will focus on the role of cashless transactions in facilitating social distancing and new business models arising from the Coronavirus pandemic, the project will also aim to examine the effects on consumer spending and the increased potential of debt accumulation that may come as a result.
Dr Whittle added: “The funding from the Productivity Insights Network will help us to use our expertise in assisting businesses and organisations across Greater Manchester and the wider region to adapt to new ways of operating.
“Our research will also help us to understand if decisions to go cashless are driven by the business alone or as a response to the changing environment brought about by the pandemic.”
The project will help to support the increasing number of hospitality venues across the UK that are opting to become cashless, with a recent report from the British Retail Consortium showing that credit card spending had overtaken cash for the first time.
