A Deep Dive into Digital Payment Adoption and Its Social Impact
Singapore stands at the forefront of the global digital revolution, and nowhere is this more evident than in the rapid proliferation of cashless-only stores across the island. What began as a hygiene measure during the Covid-19 pandemic has evolved into a structural shift in how Singaporeans conduct everyday transactions. Yet beneath the efficiency gains and technological progress lies a growing concern: certain segments of society—particularly teenagers without bank accounts and elderly citizens unfamiliar with digital payments—are finding themselves increasingly sidelined in an increasingly cashless economy.
The Rapid Transformation
The shift towards cashless payments in Singapore has been nothing short of dramatic. During a recent survey of malls in Bugis, Orchard, Somerset and Dhoby Ghaut, approximately 14 percent of surveyed shops displayed “cashless-only” signs. This may seem modest at first glance, but the concentration of these stores in high-traffic retail areas suggests a much deeper trend underway.
Major retail chains have led this charge. Chagee, a popular tea company, has transitioned all 19 of its outlets to accept only digital payments. Tiong Bahru Bakery, with 20 outlets across the island, went completely cashless by early 2020 and has maintained this stance ever since. Starbucks, operating around 130 outlets in Singapore, accepts cash at only approximately 92 of them, with strategic locations in tourist areas and lower-traffic zones maintaining cash acceptance.
This represents a striking inversion of the pre-pandemic payment landscape. Before Covid-19, many establishments insisted on cash-only transactions. Today, the pendulum has swung decisively in the opposite direction, creating a landscape where cash acceptance is increasingly becoming the exception rather than the rule.
The Business Case for Going Cashless
The motivations driving merchants to abandon cash are both practical and financial. Shop owners consistently cite three primary benefits: operational efficiency, hygiene and cost reduction.
From an operational perspective, cashless transactions dramatically streamline business processes. Chagee’s head of operations notes that going cashless means shorter queues, quicker transactions and fewer errors, allowing customers to receive their orders more quickly and consistently. Tiong Bahru Bakery’s general manager emphasizes that the system allows staff to serve guests more efficiently during peak hours while creating a more hygienic environment by eliminating the handling of physical money.
The financial argument is equally compelling. Singapore’s government has been instrumental in facilitating this transition through deliberate policy interventions. The Smart Nation agenda, coupled with grants under the SMEs Go Digital programme, has made it significantly easier and cheaper for merchants to implement digital payment systems. According to finance experts, merchants now have access to affordable plug-and-play solutions rather than requiring expensive point-of-sale systems.
Perhaps most significantly, the commission structure of modern payment methods has become far more competitive. QR-code payment systems charge considerably lower commissions than traditional card networks, making them particularly attractive to small businesses, hawkers and micro-enterprises that previously avoided digital payments due to prohibitively high card transaction fees. These economic realities have created a compelling business case that extends well beyond large retail chains to encompass the broader merchant ecosystem.
Additionally, cashless systems offer merchants non-financial advantages. They reduce theft risks, minimize human error in account reconciliation and provide valuable data on customer purchasing patterns. For business owners, these benefits represent a combination of safety, accuracy and strategic insight that cash transactions simply cannot provide.
The Digital Divide: Teenagers Without Access
For teenagers in Singapore, the transition to a cashless society presents an unexpected barrier. Many young people lack access to bank accounts or debit cards, particularly those under 16, and find themselves unable to make even modest purchases at increasingly digital-first establishments.
Consider the experience of 15-year-old Jiya Sharma, who visited Starbucks at Downtown East two months ago to study. She left empty-handed that day when she discovered the outlet no longer accepted cash. This was not an isolated incident—she had experienced a similar situation a year earlier when trying to purchase food from Wok Hey at White Sands mall after the store stopped accepting cash. Over two years of regular visits to the Starbucks outlet, her routine was abruptly disrupted by a change in payment policy.
Similarly, Bazil Khair, another 15-year-old, found himself unable to catch a movie with friends at Causeway Point in 2024 after the cinema stopped accepting cash. His frustration is palpable: “It’s annoying that I can’t even use cash for something that costs less than $10.” He is looking forward to obtaining his own debit card once he turns 16 in November, yet this arbitrary age threshold means missing out on experiences and social activities in the interim.
The barrier for teenagers is not one of preference or digital literacy, but rather systemic. Singapore’s banking regulations typically allow minors to open bank accounts only with parental consent, and debit card issuance follows similar restrictions. Yet the pace of cashless adoption at the retail level far outstrips the availability of accessible payment solutions for this demographic.
This creates a peculiar form of age-based exclusion. Teenagers are digital natives who have grown up with technology, yet they remain locked out of transactions simply because they haven’t reached arbitrary age thresholds set by financial institutions. The experience of being turned away from stores—sometimes with visible annoyance from service staff—carries psychological weight beyond the immediate transaction. It sends a message that certain segments of society are not valued customers.
The Elderly and the Digital Divide
While teenagers face age-related barriers, elderly citizens confront a different but equally significant challenge: unfamiliarity with digital payment systems and, in some cases, a fundamental preference for cash transactions.
Madam Nisa Khalid, 66, has spent her entire adult life using cash for transactions. Her struggles with PayNow—Singapore’s peer-to-peer payment system—underscore the learning curve that accompanies digital adoption. On one occasion, a bakery cashier responded with visible irritation when she handed over a $10 note for waffles, pointing to a QR code instead. With five customers queuing behind her and the cashier rushing, she felt deeply embarrassed. Her request is modest and poignant: “I wish that service staff would be more understanding. It will be less daunting for older people to switch to digital services.”
This incident reveals not merely a transaction problem, but a broader issue of dignity and respect. Elderly customers are not rejecting digital payments out of stubbornness, but rather adapting to fundamental changes in how commerce operates in real time. The harshness of some staff responses suggests that the human dimension of this transition is being overlooked.
Even more stark is the situation of Madam Khong Kwan Kuen, 94 years old, who does not own any debit or credit cards. She explicitly stated her preference for using cash when shopping for groceries and issued a clear warning: “Many of the shops I buy things from accept cash. If they stop doing so, I will stop buying from them.” This is not hyperbole but a practical statement about her ability to participate in the economy. For people in their 90s, learning new digital payment systems may not be a matter of willingness but of capacity and comfort.
Security guard Samsul Amir, 57, presents yet another case: he has never been able to buy from the only vending machine at the community centre where he works because he does not have a debit or credit card. This is not a matter of preference but of access—he has been unable or unwilling to navigate the banking system to obtain these cards.
The elderly population faces multiple interconnected challenges. First, there is the psychological barrier of learning new systems that may seem complicated or unnecessarily complex. Second, there is the practical reality that not all elderly citizens have bank accounts or understanding of digital platforms. Third, there is the social dimension—being unable to participate in normal commercial transactions in a dignified manner creates a sense of exclusion from society.
Migrant Workers and Structural Barriers
The cashless transition has created unexpected hardships for another vulnerable group: migrant workers in Singapore. Domestic helper Dude Surya, 43, who has worked in Singapore for approximately eight years, described a degrading situation where she must ask other customers in queues for assistance, paying them back in cash. “I feel frustrated sometimes, because I don’t have a bank card,” she explained.
This situation highlights a critical gap in Singapore’s cashless transition: the assumption that all workers have equal access to the formal banking system. Many migrant workers face structural barriers to opening bank accounts, including requirements for local identification, minimum deposits or unfamiliarity with the system. Some send most of their earnings home and operate on a cash-only basis.
Ms. Surya’s need to ask others for help is not merely inconvenient—it represents a loss of independence and dignity. The transaction becomes a social interaction requiring assistance, rather than a straightforward commercial exchange. In a society that prides itself on efficiency and modernity, such situations reveal cracks in the system’s inclusivity.
The Generational and Socioeconomic Dimensions
The cashless transition in Singapore reveals deep fault lines in terms of both age and socioeconomic status. Those who grew up with digital technologies, have stable employment with formal banking relationships, and possess the financial literacy to navigate digital payment systems have embraced cashless transactions enthusiastically.
However, those who did not benefit from these advantages—elderly citizens who learned financial management in a cash-based world, young people who lack access to banking products, migrant workers navigating unfamiliar systems, and those with lower incomes who may rely on cash budgeting methods—find themselves increasingly marginalized.
This is not merely a matter of consumer preference but a question of equity. In a developed economy like Singapore, the ability to participate in commerce should not be contingent on age, immigration status or technological comfort. Yet the rapid transition to cashless-only establishments has created precisely such conditions.
Government Policy and the Smart Nation Agenda
Singapore’s government has been instrumental in facilitating the shift towards digital payments through the Smart Nation agenda and the SMEs Go Digital programme. These initiatives have successfully reduced the cost barriers for merchants to adopt digital payment systems, democratizing access to technology that was previously available only to large corporations.
However, government policy has not adequately addressed the human side of this transition. While grants and incentives have made it easy for merchants to go cashless, there has been insufficient policy intervention to protect vulnerable populations from exclusion.
Several policy responses could mitigate the negative effects of rapid cashless adoption. First, regulations could mandate that major retail establishments maintain at least one cash-accepting payment option, particularly in essential services like groceries, pharmacies and transportation. Second, accelerated programmes could be implemented to help elderly citizens understand and adopt digital payment methods, rather than assuming they will naturally adapt.
Third, financial institutions could be incentivized to develop banking products specifically designed for teenagers and migrant workers, addressing the access barriers these groups currently face. Fourth, retailers could be encouraged through corporate social responsibility initiatives to maintain cash acceptance at specific outlets designed to serve vulnerable populations.
The Role of Retail Strategy
Interestingly, some retailers have demonstrated that selective cash acceptance need not compromise operational efficiency. Eat Pizza, for example, operates eight outlets in Singapore, with only the location at Temasek Polytechnic still accepting cash. The company made this decision “to better cater to the students there, who may not have payment cards to pay for food.”
This approach represents a nuanced middle ground—recognizing that different customer bases have different needs, and that accommodation of these needs may actually expand rather than limit market opportunities. Similarly, Starbucks continues to accept cash at stores in high-traffic tourist areas and lower-traffic locations, explicitly acknowledging that customer profile and transaction patterns should inform payment policy decisions.
This demonstrates that the choice to go entirely cashless is not a technological imperative but a business decision. Retailers could voluntarily adopt similar strategies—maintaining cash acceptance at certain locations or during certain hours to serve vulnerable populations—without significantly compromising operational efficiency or profitability.
Social Cohesion and the Pace of Change
Beyond the immediate inconvenience, the rapid transition to cashless commerce raises questions about social cohesion and the pace at which Singapore should advance its digital agenda. Singapore has long prided itself on being a multicultural, inclusive society that brings all segments of the population along in its development journey. The cashless transition, however, risks leaving behind precisely those groups—the elderly, the young, the working poor—that societies have a particular obligation to protect.
The experience of Madam Nisa Khalid being snapped at by a cashier is not merely an individual discourtesy but a symptom of a broader cultural shift in which digital natives may lack patience for those adapting to new systems. In a society undergoing rapid technological change, cultural empathy and patience become essential social resources.
Toward a More Inclusive Transition
Singapore has demonstrated remarkable capacity for managing rapid technological and social change. The country’s success with digital government services, Smart Nation initiatives and technological innovation across sectors is globally recognized. However, the current pace and scope of cashless adoption has outpaced the social infrastructure needed to ensure inclusive participation.
A more balanced approach would recognize that technological progress and social inclusion are not mutually exclusive but rather complementary goals. The following measures could help ensure that Singapore’s transition to a cashless economy does not inadvertently create a two-tier society:
Regulatory intervention should establish minimum standards for cash acceptance at essential service providers and public-facing businesses. Just as safety standards and food hygiene regulations protect consumers, payment accessibility standards could protect vulnerable populations.
Financial inclusion programs could help elderly citizens, teenagers and migrant workers gain access to appropriate banking products. These programs should emphasize simplicity and address specific barriers faced by each group.
Retail accountability could encourage businesses to consider the social implications of cashless-only policies. Corporate social responsibility frameworks could include metrics related to payment accessibility and service to vulnerable populations.
Community support systems could provide assistance to elderly citizens and others struggling with digital payments. Libraries, community centers and volunteer organizations could offer training and support.
Flexibility and accommodation should remain central to retail policy. Businesses could maintain selective cash acceptance, stagger transitions or offer support services rather than abruptly eliminating cash options.
Conclusion
Singapore’s transition to a cashless economy represents genuine progress in terms of operational efficiency, hygiene and technological advancement. The benefits to businesses and to digitally-enabled consumers are real and significant. However, this progress should not come at the expense of vulnerable populations who lack access to digital payment systems or the comfort with technology needed to adopt them.
The experiences of teenagers unable to catch movies, elderly citizens embarrassed by their inability to pay, migrant workers forced to ask strangers for assistance, and seniors who will simply stop shopping rather than adapt tell an important story. They suggest that Singapore’s cashless revolution, while impressive from a technological standpoint, requires more thoughtful human-centered design.
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