A GRATUS.IO WHITE PAPER (IN PROGRESS)
Casualties of A Cashless Society
How Mobile Payments Can Solve This Problem
If you are one of the 4.9 million tipped service workers in US who relies everyday on cash-based tips, a cashless society means that your take-home earnings are decreasing. The reality: It is becoming even harder for service workers to make a living wage from a minimum wage.
We believe that optimizing mobile and financial technology will provide a solution for tipped service workers, especially for women.
80% of the tipped service industry are women
The cashless society will have a disproportionately negative impact on workers who rely on tip-based earnngs. Women are responsible for 80% of spending on food, home, clothing, children, education. In the US, hotels, 99% of housekeepers are women. Women represent 80% of domestic spending -- that's groceries, clothing, education, children. Solving this problem makes good economic sense. When we increase women's earnings through tips, it is goes back into the economy. Research has found that providing customers with a mobile payments option increases tips by up to 30%.
Paper or Plastic?
In a survey conducted by Credit Karma, half of all Americans today are using a credit or debit card to tip their server in a restaurant. What's notable is that those who are using plastic are not only leaving higher tips, they're tipping more often than those who pay in cash.
- About 9 in 10 of those who pay with plastic say they always tip the wait staff, compared to only 76 percent of those who plunk down cash.
- Sixty percent of those who pay with plastic say their tip usually exceeds 15 percent of the bill, versus 45 percent of cash payers.
- In fact, almost a third of those who pay in cash admit that they typically leave a tip of 10 percent or less
From New York to Miami
The Promise of Mobile Payments
Bringing cashless tipping to the service industry has several benefits -- what we call a win-win-win. It is conceivable through mobile payment that we can make a difference for every woman who receives tips -- one tip at a time.