San Francisco Chronicle
Chinatown businesses depart from ‘cash only’
Pilot program to supply modern payment systems helping reluctant merchants
Almost three years after the pandemic pushed San Francisco’s Chinatown to the brink, a handful of businesses are trading their “cash only” signs for modern payment systems that allow patrons to buy a meal with the swipe of a card.
Those behind the effort hope the easier mode of payment will bring business back to America’s oldest Chinatown, but they’re having to overcome the reluctance of some business owners and the neighborhood’s slow internet speeds.
Volunteers from the community organizations BeChinatown and Chinatown Volunteer Coalition as well as the Asian Leaders Alliance, a coalition of employee and business resource groups, have obtained and rolled out tablets and card readers to six businesses, with a seventh in the works, in a pilot program that began in the summer.
Some of those businesses are now reporting increases in revenue of about 30%.
“That could mean the difference between being able to pay rent or closing down for good,” said Myron Lee, a BeChinatown community advocate who helped persuade cash-only businesses to make the switch.
The effort was funded by a $10,000 grant from the US Pan Asian American Chamber of Commerce. Lee said that based on the pilot’s success, the group hopes to eventually provide cashless payment systems to every business in Chinatown that doesn’t currently accept such payments but wants to.
The volunteers had to overcome the hesitance of some business owners to accept digital payments. Many of the business owners are immigrants with limited English proficiency, which can make it difficult to navigate digital payments. Some
are also hesitant about processing fees, which shave a fixed percentage off each transaction.
But cashless payments can be a powerful tool in the local economy, explained BeChinatown founder Lily Lo, who led the project. Locals tend to prefer cash, but tourists, young people and residents from outside the neighborhood are increasingly reluctant to carry cash.
That was the case for Erika Ward, who visited the neighborhood from Utah as part of a choir tour. She expressed her appreciation for a gift shop’s digital payment system, which she used when purchasing souvenirs for her grandchildren.
“The credit card reader is huge because not a lot of people carry cash anymore,” she said. “Being able to do that made the difference in purchasing for me.”
Chinatown has been in recovery mode since the pandemic, when 75% of its businesses spent some part of 2020 out of operation and the city pumped $1.9 million into the local economy by paying restaurants to feed residents of local single-room-occupancy hotels. According to the San Francisco Chamber of Commerce, overall city tourism numbers are still climbing out of the depths of the pandemic, with about 2.1 million visits in August 2022, down 27% from the nearly 2.9 million visits in August 2019.
Lo added that safety is also an upside of the new systems, as a “cash only” sign can be a signal that a business has a lot of money on hand, which could increase the risk of a robbery.
Though area merchants have expressed concerns about such crimes, the number of reported crimes in the neighborhood, including “money-motivated” crimes like robberies and burglaries, fell during the pandemic, according to Police Department data.
Persuading business owners to take the leap was not easy, but Lo has the goodwill of the community from her longtime work advocating for Chinatown businesses and her familiarity with the neighborhood. When she walks through Chinatown, she can point out many of the businesses and the methods of payment they accept.
Lo said the organizations also made sure to have volunteers on hand to provide ongoing support to the businesses, such as figuring out an error code or helping manage a more complicated transaction. Once the businesses have a few months of experience with the systems, she said, they can start to see their efforts pay off.
“They get used to it, and they can see that it’s bringing them extra income,” Lo said.
Philip Vuong of Golden King Vietnamese Restaurant is one such business owner. He has owned the business since the early 2000s, but he started taking cashless payments only in the summer. He said his restaurant has lost a significant amount of revenue in the wake of the pandemic, and people are also carrying less cash.
“When you say ‘cash only,’ customers say, ‘Sorry, next time,’ but when is the next time?” he said.
With the new payment system, he estimates that his revenue has gone up by about 30% to 40%, which translates to as much as an additional $8,000 a month. Though his business still hasn’t recovered to pre-pandemic levels, he said the switch is keeping him afloat.
“You wouldn’t believe it,” he said of the increase. “Without it, no one would come in.”
New Lun Ting Cafe owner Frances Mah, who has worked at the restaurant for over 30 years, also recently came around to cashless payments, having made the switch in December. She said she initially thought it would be too much trouble — cash is easier, she said, and she didn’t like the idea of paying a fee.
But thanks to the change, her revenue is also now up. “So far, so good,” she said.
However, the switch has not been entirely without its difficulties. Slow internet speeds, which can leave customers and employees waiting for a payment to process, have been a source of frustration, Mah said.
Chinatown’s internet has been an ongoing challenge for businesses and residents alike in Chinatown. Delta Chinatown Initiative founder Lily Ho, who has worked to improve internet access in the neighborhood, said these slow speeds constitute a form of “infrastructure redlining.”
“This community is singled out from a basic resource, broadband internet, in the middle of Silicon Valley,” she said.
Yee’s Restaurant owner Vicky He faced this challenge directly on a recent afternoon when a customer attempted to pay with a card while the internet was down. “This sometimes happens,” He apologized.
The customer eventually paid with cash, but He said she sometimes has no other option when such situations arise than to either send the customer off to a bank or an ATM to get cash or to wait for an indefinite period of time for the internet to work again.
It’s a challenge, she said, but being able to process cashless payments is better than the alternative: On a good weekend day, the new payment system can mean $500 to $1,000 more in revenue.
“It’s really helpful,” she said through an interpreter. “I’m happy with it.”