Why Cashless Events Rock

cashless events

It’s hard to deny the world’s gradual shift toward a cashless economy, but it’s equally hard to determine just how such an economy is going to look. Businesses, consumers and developers have been flirting with cashless technologies for decades and the desire to leave cash behind is only growing. Still, there has been no clear frontrunner in the race for a satisfying alternative to cash.

The latest runner in the race is RFID or Radio Frequency Identification. This contactless technology is now being harnessed by music festivals to eliminate the need for cash within the gates of their events. These festivals have had some great success with this technology, so the future of large events could very well be cashless. Could that mean that RFID is the alternative to cash we’ve been waiting for?

How it works

RFID technologies involve planting a chip into a device or object which can transfer data using electromagnetic fields. In the live event industry, these chips are typically implanted in wristbands as wearable technology greatly increasing the convenience for patrons, who can “load” their wristbands with funds beforehand and use them to pay for food and drinks, merchandise, etc., eliminating the need for bringing cash into the festival.

Many festivals had already tried using the NFC technologies integrated into most smartphones to achieve the same goals, but with limited success. NFC’s effectiveness in these large, outdoor, multi-day events was limited by the short battery life and the fact that not all attendees own smartphones.

In 2014, RFID’s acceptance at festivals soared past NFC for two key reasons: with the chip implanted in the wrist-band, everybody with a pass to the festival is guaranteed to be wearing RFID technology, and, unlike cash or NFC-equipped smartphones, the risk of theft for these wristbands is extremely small.

Why cashless events rock

Consumers in general are moving away from cash. The only reason why we haven’t seen a mass exodus (yet) is that the alternatives have failed to match the ease and convenience of making cash payments, whether that’s due to debt concerns in the case of credit cards, prohibitive fees for debit cards, or the lack of adequate technologies for NFC transactions.

The latter is also true of RFID. In general use they don’t live up to cash because most merchants lack the ability to accept RFID payments. However, a large, multi-day festival is a very unique setting. In fact, it could easily be viewed as a micro-economy of its own with a central authority (the organisation promoting the festival) and any number of businesses operating within the gates of the event.

In this way, festivals can impose their own payment systems, such as RFID transactions, and guarantee that every attendee possesses that technology and every vendor possesses the ability to accept that type of payment. To use a different type of event as an example, beer festivals have been doing this for decades by using proprietary tokens as their currency, with attendees “exchanging” cash for tokens at centralised locations.

This is such an effective technique because it eliminates the need for servers and vendors to handle cash, issue change, or accept multiple forms of payments. This improves the speed and quality of service they are able to provide, which is necessary in a crowded festival setting but would be a boon to any commercial environment.

The proof is in the numbers:

Consumers love cashless events, for the aforementioned shorter queues and decreased risk of theft. Within the last year, with many large festivals taking the plunge into a 100% cashless environment, we’ve seen a much more widespread public acceptance of cashless payments in general and RFID in particular.

Now the challenge is to get consumers to take these technologies with them when they leave the festival. RFID could be the alternative to cash that we’ve been waiting for, but there are still some kinks to work out. The end-game is always to make things easier – RFID is quicker and more convenient for both consumers and merchants, but until merchants achieve something close to a universal acceptance of RFID payments, consumers won’t leave cash behind.

That’s why cashless events rock. They’re a testing ground for a cashless economy, and the fact that they’ve been so successful that some of the biggest festivals in the world switched to 100% RFID payments in 2014 is a sure sign that this technology is succeeding where NFC failed, and is a strong contender for the true alternative to cash.

Subscribe to the DalPay Blog to be notified about all our future industry insights about the latest technologies and developments in the world of digital payments in both online retail and at the point-of-sale, and follow us on Facebook and Twitter for the latest news from around the e-commerce industry.

Enter your email address to follow this blog and receive notifications of new posts by email.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s