WHERE CASH IS NO LONGER KING
MORE AND MORE MANCHESTER BARS AND COFFEE SHOPS ARE DOING AWAY WITH CASH AND TURNING TO CARD AND BITCOIN
IF you fancy a pint in Sandbar, put your pounds and pennies away they won’t accept them. The popular craft beer bar is one of a growing number of bars and coffee shops in Manchester doing away with cash - and has even adopted cryptocurrency in its place.
The Grosvenor Street venue went cashless in February and signs at the bar tell customers ‘we now only accept card and Bitcoin payments.’
“Basically we think it’s the future,” says manager Ash Wright.
“Ten years ago, 95% of our take was cash. In the last two years it dropped down very sharply to 25% before we stopped taking it. I think that’s a trend that’s going to continue.”
Cutting out cash saves money and time and keeps staff safer at work, he says.
Around £1,200 has been saved straight away in annual banking charges by the move, which will also free up staff to focus on other tasks.
“The cost involved in servicing cash was completely unbalanced compared with card payments,” says Ash.
“It was costing us 40 hours of management time a week auditing it, counting it, banking it, doing all the cash sheets and till sheets.
“On top of that there is a huge amount of risk. There have always been robberies in bars but recently there have been a few with guns. It suddenly became more of a serious risk.
“I don’t want a gun in my face and it’s not something my staff should have to risk as part of their job.”
Customers have been broadly welcoming of the move, he says, although a small group of disgruntled former regulars have taken to Facebook and TripAdvisor to vent their frustration at what they have called a ‘discriminatory and shortsighted decision.’
Those critical of refusing cash payments say it excludes people without bank accounts, who number around 1.5m in the UK according to the Financial Inclusion Commission.
But while it may be known as legal tender, businesses are under no legal obligation to accept cash as payment - the term is only relevant in the settlement of debts.
Cash usage is in sharp decline in the UK. In 2006 it was used for 62% of all payments according to UK Finance, falling to 40% in 2016. By 2026 it is predicted to be used for just 21% of transactions.
Nearby on Oxford Road, independent coffee shop Takk and sister bar and nano brewery OL have also been cashless since opening inside pop-up food, drink and retail development Hatch.
Director Philip Hannaway says it was a logical step.
“Ninety per cent of our transactions were through card and the amount of cash people were paying was going down and down and down,” he says.
“It quickens the process of paying and also means we don’t have staff members, or myself, going through town with pockets of money having
to go grab change from the bank.
“There’s quite a few places in Manchester who have been burgled for cash that’s held on site. We don’t have the worry about holding cash on site at the venue.
“Another thing people don’t appreciate is for a small business is the banks charge us for putting cash into our own accounts. It’s hundreds and hundreds of pounds over the year.
“We’re saving on the cost of having someone cash up at the end of the night. Cashing up is now simply pressing a button on a report. As a small business, margins are tight and these things all add up.”
Customer feedback so far has been predominantly positive, Philip says, and he plans to follow suit at the original Takk, on Tariff Street, and the branch opening later this year at University Green, off Oxford Road.
“We wanted to test it to see if there was any push back by doing it at Hatch, which is quite an experimental development,” he says.
“People have been quite supportive, generally. We’ve had one or two people who aren’t happy and that’s mainly on the basis of keeping people’s data. But I’ve yet to meet anyone who doesn’t pay for something on their card at some point.”
Data and privacy concerns were a factor in introducing Bitcoin payments at Sandbar, Ash says.
While transactions are still traceable, Bitcoin and other cryptocurrencies purport to offer a greater degree of anonymity than card payments.
Created in 2009, Bitcoin in its most basic sense is a form of digital money ‘mined’ by computer. Unlike traditional fiat currencies such as the pound, it no central bank and is not regulated by any organisation or state, and its value has fluctuated wildly over the years. One Bitcoin was worth around £6,040.85 at the time of writing - down from over £14,000 at its peak in December 2017.
“We’ve had a few people pay with it,” says manager Ash Wright.
“For most people it’s a novelty, because the money they’ve got in Bitcoin is investment money, not money to buy a beer with.
“We’ve had some people come in and say ‘I didn’t even know that was real.’ A lot of people aren’t aware of it at all.
“It’s been quite contained within its own world so far and I suppose bringing it into a bar setting we do hope to further its expansion and awareness and take part in what a lot of people think is quite an exciting emergence of cryptocurrency into the mainstream economy.”
UK regulators view Bitcoin as a commodity rather than a currency, but it is gaining credibility as a legitimate method of payment for a growing number of retailers.
Manchester has a handful of Bitcoin ATMs where you can trade your sterling for cryptocurrency, including The Corner Store a few doors down from Sandbar.
The shop was among the city’s earliest adopters of Bitcoin and has a machine where you can purchase the currency and load it into a digital wallet on your phone. In the spirit of this feature I try to pay with my card, but it’s cash only.
Irony aside, paying for a pint with Bitcoin is as simple as using Apple Pay.
“A customer would come in as normal, they’d purchase a drink as normal. When they come to pay, instead of setting up a transaction on the card machine we present our QR code and they’d get their phone out, they’d pull open their Bitcoin or cryptocurrency wallet, and they would scan our QR code,” Ash explains.
“It’s very fast and no different to customers who are coming in with their bank cards loaded on their phones.”
The system is still far from seamless, however. Transactions can be slow to be confirmed and fees vary wildly depending on the wallet provider.
The crypto community is currently working on ways to resolve these issues, which pose a significant barrier for businesses and customers.
“It’s not something we see as a profitable model at the minute,” Ash admits. “It’s about raising awareness and being part of its growth.”
Back at Takk, Philip is also considering the potential of cryptocurrency.
“Technology is becoming such that I think it will become more and more common,” he says.
“I think we will [accept Bitcoin in future], it’s something we’ve looked at. A lot of our customers work within the tech industry and that’s something they are keen to see us do.
“It’s definitely something that we’re open to. We just want to make transactions as easy as possible for the customer and introduce systems that make the best use of our team, so we can give over more time to preparing great coffee and treating our customers to a great experience.
“If we can take the faff away from the exchange we can focus on providing a great service. If that’s cryptocurrency in the future that’s what we’ll do.”