Why do Contactless Payments Make Us More Generous?

A recent study has demonstrated that more customers tip when using Tap & Pay. In general, it seems that contactless payments make people more generous. Why? Here is my own perspective on this.

Source: SquareUp (Image by Plutus.it)

One reason is that we have become sorely addicted to task switching. We seek the next niblet of information before we have digested the first. Movie often cut to other angles and scenes before the previous one is even over, leaving our mind to fill in the blanks with whatever is available.

We feed our attention with fast, easily consumable units of factory-made information that usually do not contain any new or even useful knowledge. And if a unit of information takes more than a second to understand, we create a stereotype to cover it with and move on to the next niblet. And even though focusing is increasingly more stressful, It feels comfortable to fast forward the mind’s eye.

Evidence for this phenomenon is everywhere. Most notably, eCommerce giant Amazon has shows that if a page takes only tenth of a second longer to load, they lose 1% of potential purchases.

Source: http://www.fastcompany.com/1825005/how-one-second-could-cost-amazon-16-billion-sales

When paying is as fast as holding your phone above a card reader, it is not a surprise that we are more inclined to be impulsive. People tend to tip more when the time required to complete the payment is reduced. Waiting too long for the waiter or digging around in the wallet for coins and bills may confront you with reasons not to spend more than you should. It may steal your attention.

If you can pay seconds after the coffee is ground, and leave with a coffee cup in your hand seconds after you smell it, it is our intuition that lets us know that value has been added into the process. We usually don’t even know why.

The second reason is that when we use cashless payments, we are not surrendering anything physical.

“Have you ever noticed that their stuff is shit and your shit is stuff?” — George Carlin

Coins are heavy, and paper is tactile. You have to pull out your wallet, pick out the right amount and extend your hand to the cashier. In many ways this is a symbol of surrender. And because human ego boundaries are not entirely fixed, it is the process of giving up a part of yourself.

This is well documented in psychology and known as the ‘Endowment Effect’, where you value things that you own far more than if you do not own them. This also presents as a natural hesitation when giving a physical object to someone else.



This effect also applies to regular credit card and debit card payments. Credit cards are a ‘magic’ piece of plastic that create a virtual (“unreal”) flow of seemingly infinite money. Nobody has ever looked at a card, and know in their HEART that it is empty. Sure you can tell yourself that you are in debt, but will the card ever FEEL empty? No.

As such it is easier to surrender a virtual idea of money rather than physical cash. After all, it’s not real, right?

Source: https://www.uni-muenster.de/imperia/md/content/psyifp/aeechterhoff/wintersemester2011-12/vorlesungkommperskonflikt/feinberg_credcards_jouconres1986.pdf

The third reason is the contactless nature of the payments themselves.

Being able to buy goods and affect the world around you with a swipe of your hand is inherently appealing. It exists in the manual maneuvers of a magician, the gestures of any great orator, and the fingers of an angry teenager. In some childlike sense, it feels like magic.

Whatever the reasons may be, the increased ‘generosity’ is a blessing to overworked waiters, service providers, and charities alike.

Here are a few clever ways contactless is being used for charities, a trend I sincerely hope will continue.

Contactless Donation Terminals Will Help Hungry Schoolchildren

UK Charity collects contactless donations using cute dogs.

About me: Hello, I am Fil. I’m a UX copywriter and memetic engineer, as well as the CCO of Plutus Tap & Pay, an NFC app that lets you pay with Bitcoin and Ethereum at any existing contactless terminal.

In case you are confused, here is what I do:

UX Copywriting — Creating text & branding for products, ads, and services that improves clarity, as well as the subjective user experience.

Memetic Engineering — A combination of inbound marketing, social media management, A/B testing, psychology, and Python NLTK development with the purpose of creating ideas that spread.