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Less money in their pockets when Millennials go cashless

Categories : Cash facilitates budgetary control, Cash is efficient
December 8, 2017
Tags : Australia, Card payments, Millennials, Transaction
Millennials are spending more with contactless cards than necessary.
Communication Team / Equipo de Comunicación

Ninety-two percent of transactions in Australia are now made with contactless payments, beating any previous records. But Jacqueline Park, co-founder of Carrot Money – an online app designed to help people save – states that it has become too easy to spend when the connection to physical payments is severed. Indeed, a study from the Sydney University found that consumers are 50% more likely to spend more than necessary when using anything other than cash.

Donnel Briley, professor of marketing and behavioral psychology at Sydney University confirmed that “there’s good empirical evidence that people spend more money when they don’t actually have to use cash, and that goes across different alternative forms of payment.”

Similarly, in the UK, consumers admit to spending more when using contactless payments, but even more so when using mobile payments like Apple Pay. In fact, 72% of respondents of a ClearScore poll last year admitted to carrying out impulsive shopping sprees when using mobile payments.

How to avoid spending out-of-budget? Follow Briley’s advice: simply start taking out the amount of cash you need for a week, and stick to that budget.