Keep the change

Covid-19 may change one common American behavior forever

Covid-19 may complete a slowly unrolling prophecy foretelling the end of cash. 💸

Emma Betuel/Inverse

In the before times, you didn't hesitate when someone dropped loose change from a cash register into your ungloved palm. Maybe you shoved the coins in your pocket or dropped them in a tip jar. You almost certainly touched your face afterward.

The simple act of making change is one of many that has been altered by Covid-19, especially in communities where many know somebody affected by the mysterious new illness. Strangely, the coronavirus pandemic may complete a slowly unrolling prophecy foretelling the end of cash.

We’ve been forecasting the end of cash for almost two decades: In 2002, the Organization for Economic Cooperation and Development’s Future of Money report projected that “money’s destiny is to become digital.” By 2007 PayPal, one of the earliest companies to specialize in digital payments, received a banking license from the EU. In September 2014, Apple Pay was launched. “Apple Pay will change the way you pay,” the company’s press release declared.

Still, cash remained the most common form of payment until 2018, when debit cards topped cash use for the first time.

While paper money has been projected to die, it might be a global pandemic that has sickened millions, not new technology, that finally kills cash. After all this, making change may just never feel the same.

Cash has always been covered in foreign microbes, but consumers are acting differently now that we're faced with coronavirus.Emma Betuel/Inverse

Hands off — In late March, US coronavirus cases first topped 100,000. Simultaneously, a survey of 361 businesses found that 27 percent saw an increase in customers using electronic payments like Apple Pay. (The survey was conducted by the Strawhecker Group, a consulting firm for the electronic payments industry.)

In Apple's second-quarter earnings call last month, Senior Vice President and CFO Luca Maestri said that outlets like Trader Joe's are adopting Apple Pay "to better serve customers safely."

In the first quarter of 2020, MasterCard reported a 40 percent rise in contactless payments. MasterCard's soon-to-be CEO Michael Miebach attributed the rise to shoppers "looking for a quick way to get in and out of stores without exchanging cash, touching terminals, or anything else."

Old Money — The risk of getting Covid-19 from cash is low. But it could change the way we use and view physical money.

Johannes Knobloch is a microbiologist at the University of Hamburg who studies how microbes interact with surfaces. His research has suggested that microbes tend to thrive better on bills (made from cloth fibers) than coins made of metal, though they can survive on both surfaces. Copper has antimicrobial effects, which makes it harder for microbes to linger on pennies.

"We did NOT say that cash was transmitting coronavirus."

When it comes to the coronavirus, he says money poses very small risks.

"The virus can survive on surfaces, therefore surfaces might be a small part of transmission," Knobloch tells Inverse.

Jennifer Horney, an epidemiologist at the University of Delaware, tells Inverse there is evidence that coronavirus can persist on surfaces. But cash doesn't appear to be uniquely risky.

"There is no evidence that cash would be more effective at transmitting coronavirus than any other surface," says Horney.

In the early days of the pandemic, society narrowed in on cash right away. In early March, the World Health Organization told The Telegraph that cash could potentially be spreading the coronavirus. A week later, the group clarified its position, telling Marketplace that the organization's comments were "misrepresented.”

"We did NOT say that cash was transmitting coronavirus," WHO spokeswoman Fadela Chaib said.

The damage was done. The Fed "quarantined" cash that came directly from Asia. No official guidance about accepting cash was issued, and Individual businesses were left to decide whether cash seemed like an additional risk they wanted to take. After the back and forth at the WHO, and lack of consensus elsewhere it seemed logical to think twice about it.

Theodore Noseworthy, an associate professor of Marketing at the Schulich School of Business at York University in Canada, says fear about cash was spreading anyway.

"One of the biggest challenges that happened out front is that many governments around the world didn’t get in front of legal tender when they should have," Noseworthy tells Inverse.

That allowed the fear of the virus to become "tethered" to currency, he says. Which plays into long-established attitudes we've had towards cash.

The psychology of dirty money – A 2012 MasterCard survey showed that 64 percent of Europeans viewed cash as unclean. There are good reasons that we feel this way.

Studies ranging from the 1990s and onward have reported that dollar bills in the US are laced with cocaine (occasionally this happens because clean bills are put in counting machines with contaminated ones, lacing the whole batch with trace amounts of cocaine). More recent studies suggest that our money is host to meth, vaginal bacteria, Staphylococcus epidermidis, and hundreds of other microbes.

US Air Force research found that 94 percent of 68 bills tested contained pathogenic or potentially pathogenic organisms, suggesting it's possible to get sick because of cash. But, to bring this back to coronavirus, there have still been no documented cases that were transmitted that way.

Despite knowing that cash is gross, people don't often act upon those fears. People in the 2012 MasterCard survey were more likely to report washing their hands after touching an animal or using public transport than they were after touching cash. That, as the report notes, created a "say-do" gap: we know cash is gross, but we don't do anything about it.

Noseworthy says that the picture is actually a bit more complex. We don't realize that money is gross when we touch it because those feelings are implicit, meaning they're actually unconscious. Specifically, he says, gross-looking dollars create pathogen cues, or deep-seated feelings of unease.

Pathogen cues are triggers for disgust. Disgust is an overwhelming response that drives us to stay away from foods, smells, animals or, in some cases, people, that we believe can make us sick. Some scientists describe them as the front line of a "behavioral immune system."

“There is this innate disgusted response.”

"When you see these old crumpled up bills, there is this innate disgusted response. We feel it, we’re not really aware of it, but we want to get rid of them immediately," says Noseworthy.

Noseworthy's work suggests that money, especially if it looks like it's been fished out from under a couch-cushion, can trigger that response. We're grossed out even though we know that money, in any condition is still of value. We are eager to rid ourselves of those nasty bills.

"If we give someone these crumpled up worn, dirty bills, those will actually have greater velocity through the economy because they will leave your hands faster," he says.

The coronavirus has given us an actual pathogen to focus in on each time we touch a dollar. In that sense, transitioning to contactless payment allows us to close the "say-do" gap by abandoning cash in favor of contactless payment or credit cards.

But to give in to this impulse and abandon cash forever may not be the right answer either.

Soiled triggers an innate disgust response that could become worse thanks to coronavirus, even if risks are actually very low. Emma Betuel/Inverse

Got a bank? — To use contactless payment you need to have a credit card, debit card or some form of bank account. About 6.5 percent of Americans don't have bank accounts. An estimated 18.7 percent of Americans are "underbanked" which means that you have an account, but also operate outside the banking system.

In other words, a cashless society leaves some people behind. To that end, the Bank of Canada actually urged businesses to keep accepting cash to reduce burdens on people who only use cash to pay.

For those reasons, and because the United States tends to be a cash-driven society, we may not abandon cash in the immediate future, says Noseworthy. He predicts we may see a slight pivot toward card-based payments. MasterCard’s CEO-elect Miebach seems to think differently, and argued on that recent earnings call that payment “habits are being created today” that will outlast the pandemic.

If those habits do persist, it could be out of fear rather than convenience. As we start to see cash become even more of a “pathogen cue” in our new virus-focused world, we may increasingly feel uncomfortable with it, even if it’s not actually as big of a threat as it appears to be.

"What's interesting about this is that when all these pathogen cues come up more and more, people will be hard-pressed to even use currency, out of fear," says Noseworthy.

"The worst-case scenario is that this happens at an implicit level. So even if you say [using cash] is okay, consumers still don't understand why they're not doing it."

Liberate cash! – Businesses currently reopening are going to be the first to learn how deeply the coronavirus has penetrated our innate attitudes towards the safety of cash.

The risk of getting coronavirus from cash is low, but consumers are eschewing cash anyway. Emma Betuel/Inverse

"They’re looking at ways to make customers feel comfortable coming back in the store," says Holly Wade, the director of research and policy analysis for the National Federation of Independent Businesses, a conservative-leaning lobbying group that represents small businesses.

Contactless payments could be one way to signal that a store is taking appropriate measures to combat the virus – although that involves taking on additional costs of upgrading payment systems to accept that form of payment.

"Any extra expenses will be a high hurdle for many" she adds.

As Noseworthy points out, small businesses like restaurants that rely on tipping may also need to find ways to make those streams of revenue digital too, should they decide to only accept contactless payments or credit cards rather than cash. Anybody who has tipped their barber with Venmo may already be comfortable with this behavior.

But importantly contactless payments or not accepting cash may be part of a wider push to make people feel comfortable in stores once again. Grocery stores have added sneeze guards to protect cashiers. Many establishments ask that consumers wear masks, regardless of government policy.

"I've certainly heard from business owners who are posting signs saying their frequently disinfecting common areas to alert their customers that they're taking this seriously," Wade says.

These steps can all help protect ourselves and others from coronavirus (though, for now, nothing works as well as social distancing). But they will also serve as reminders of the coronavirus itself, says Noseworthy. Maybe going cash-free makes us feel safer, but maybe it also reminds us of how much the world has changed in the past few months.

"These are constant reminders of what happened and what may happen," says Noseworthy. "Those will have an effect on consumers and will change consumers behavior."

The next few months will show us how much our behavior has changed, as well as how often you’ll say “keep the change.”

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