Looking at the financial consequences of paying with tap
How many of us really carry cash anymore? Embarrassingly enough, I often find myself using my credit card to pay for purchases under two dollars. This might be the case for a lot of us, as we pull out cards to buy a doughnut at Tim’s and quickly apologize to the cashier for not carrying any cash. Since adapting to “tap” technology, however, I have found it less embarrassing to make small purchases because my tap device enables me to quickly pay without holding up the line behind me.
Over the past year, the usage of tapping has significantly increased in part because more people are using tap cards, but in large part due to the number of stores that have adapted to the technology. Many U of G students might have noticed campus’ use of tap machines for credit and debit in the UC, as well as the use of tap for student cards. This technology is becoming increasingly prominent.
But what can tapping due to our spending habits? Is there something to note in the convenience of making quick purchases? Are more and more people viewing their credit cards as magic fairy devices that miraculously allows us to buy things while our theoretical money slowly declines into the abyss?
[pullquote align=”left” cite=”” link=”” color=”” class=”” size=””]…technology is becoming increasingly prominent.[/pullquote]
Apparently, yes. Studies are beginning to link the increasing usage of tapping with an increase in spending. In an article published by the Global News, writer Jamie Sturgeon explored the effects of what is called “contactless” payments, or tapping to pay. According to Moneris Solutions Corp., the most popular transaction processor in Canada, the number of tap transactions increased a whole 162 percent between the start of July and the end of September in 2015, in contrast to the same time period in 2014.
Visa and MasterCard have been offering tap cards for the past ten years, however, experts suspect that this recent increase in the use of tap is most likely related to the increase in the number of merchants that now offer tap payment options.
The best way to control spending is still by using that prehistoric thing called cash. The difference between paying with cash and paying with plastic, particularly plastic that taps, is that cash is tangible, allowing the spender to see exactly what their budget is. Plastic cards leave room for an “out of sight, out of mind” attitude, making it easy to add a few extra dollars to a purchase that you may have otherwise reconsidered with a cash purchase.
Plastic, however, is much safer for other reasons. Losing a plastic card means calling your bank provider and cancelling the card, while lost or stolen cash is typically gone cash. It is also dangerous to carry large wads of cash around, as opposed to just carrying a debit or credit card. The key is to remember that just because you can’t see your finances when you pay with tap, doesn’t mean your spending will go away. Would you have upgraded that medium fries to a large if you were paying with cash? Or thrown in that extra pair of socks because they were 20 percent off? Be responsible about spending—treat your plastic card like cash, and your future self will thank you.