The cashless hotel – a futuristic dream or a real possibility?

8 Jan 2020   •  7 minute read

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The Mews Blog  >  The cashless hotel – a futuristic dream or a real possibility?

Non-cash transactions are slowly taking over, there’s no doubt about it. The World Payment Report shows that cashless transactions worldwide grew by 12% on average in 2017 and totaled 539 billion payments, 35% of which took place in developing markets. 

Credit and debit card payments have become the norm and cashless transactions outnumber cash-based ones at most properties today. 

But does that mean hotels can or should go entirely cashless soon? Let’s take a look at the pros and cons.


Potential challenges of the cashless model

Before we get into why some hotels already swear by ditching cash (or at least greatly reducing how much they use it), let’s look at some common objections hoteliers have when it comes to going cashless.


"Using cards and cashless wallet systems is too expensive"

Credit card issuers and cashless wallet providers charge hotels a commission on every transaction, usually around 2% to 3.5%. As more payments become cashless and because credit card providers have raised their merchant rates repeatedly, hotels’ costs are rising steadily, even if their booking volume stays the same. Even the virtual credit cards used by to help protect hotels from no-shows with invalid cards may sound like a blessing, but it comes with an extra commission of 2% or more. Other OTAs charge even more for this option.

However, considering things like work hours spent handling cash, losses due to fraud and human error and the administration fees some banks now charge for handling cash deposits, this objection quickly loses its punch. Many hoteliers just have a difficult time seeing this, since the cost of using cash is hidden and rarely appears on a P&L at the end of the month. 

What may surprise some is that hotels can make the biggest savings by switching to online payments rather than relying on traditional POS terminals. But more on that in a moment...


"Going cashless excludes people from certain markets"

Going cashless can mean you exclude potential customers. This could include guests from countries where people prefer using cash (such as Germany) or members of demographics who stick to cash because they may have a harder time adapting to new technology. They might not have a card or might simply not want to use it, making a cashless hotel an unattractive option for them.

While you might fear this could limit your reach, advertising a hotel as cashless can make you very attractive to a whole new audience: people who embrace new technology and value a cashless hotel’s ease and efficiency. This ultimately means that it’ll be a calculated trade-off for properties to make on an individual basis, rather than a universally negative concern.


"Cashless is too dependent on a good internet connection"

It’s true: regardless of whether you have a data connection, cash always works. When choosing how to accept payments and setting up your entire hotel tech stack for that matter, you need to take into account the reliability of your internet connection. Offline credit and debit card processing is possible, but it brings certain risks. For example, you might only identify invalid cards once it’s too late and the guest has already left. 

While it’s true that no connection means no transactions when working in the cloud, in the event that your primary internet connection goes down, all you need is a wi-fi hotspot and you’re good to go again. For the vast majority of hotels web connections are reliable enough that this won’t be a concern. If you happen to operate somewhere with particularly poor connectivity, you’ll likely want to put a bit of extra thought into workaround solutions and contingency plans.


Benefits of running a cashless hotel

Now that we’ve looked at some of the challenges going cashless could bring, let’s do the fun part and go over the advantages hotels can enjoy by going cashless and doing it right.


Improved security

Both cash and legacy payment systems come with risks and, as a hotelier, you know that every hotel has its stories of money going missing.

Why? Because cash is easy to lose or steal, it’s that simple. This can happen on a small scale (e.g. when the occasional banknote disappears from the till) or on a larger scale when human error causes repeated losses or staff in charge of the till come up with a scheme allowing them to sneak larger sums regularly. Going cashless puts an end to that once and for all.

Apart from being easy to mismanage by staff, cash brings several other security risks such as on-site robbery or the assault of a team member going to the bank to make a deposit.  

Now, let’s be clear: simply switching to debit and credit card payments using legacy terminals won’t solve all your problems. Credit card fraud involving card details being stolen or fraudsters using stolen cards to pay can still happen. Worrying examples of such breaches have taken place at Starwood, Mandarin Oriental and Hyatt and have had major implications, including reduced revenue, fines and legal fees and damage to reputation and customer trust. If this can happen to the big chains that invest heavily in security, consider how much harder smaller properties and brands can be hit.

Chargebacks are another issue hotels face when using antiquated POS systems. They come with steep admin fees from the credit card provider, lead to financial losses since no payment is received for goods and services rendered, and too many chargebacks can lead to fines and penalties such as being moved to an expensive ‘high-risk’ merchant account or having the merchant account closed altogether.

Going cashless and switching to online payments won’t eliminate chargebacks, but it does allow you to apply a rigorous layer of security. Rather than shouldering the administrative burden of resolving those chargebacks yourself, a good payment solution allows you pass that legwork to the provider, so that you don’t need to spend your time on the phone to the bank.

While serving as the GM of London’s floating Good Hotel, Liutauras Vaitkevicius experienced this first-hand when the property started using Mews’ online payment option: “Security and fraud are extremely important to both us and our customers. If our customers couldn’t trust us, they wouldn’t stay with us. Since we switched to Mews, we’ve seen the number of credit card fraud cases go down by 60%.”


Productivity savings 

Dealing with cash takes time – not just when handling payments but also at the beginning and end of every shift when staff have to count their float, balance it and go through a handover process. 

But that’s not it! The night manager has to re-balance the reception float and the accounting team has to handle the cash dropped off by a hotel’s points of sale. The larger a hotel and the more revenue generating departments it has, the more complex (read: prone to human error) and time-consuming this task becomes.

Going cashless eliminates all that manual work and makes processes throughout the hotel much more efficient. You might not even need a night auditor anymore!

“We’re saving 10 hours a week of time that we previously spent on admin and back office work!” Liutauras Vaitkevicius says about how payment automation via the Mews Merchant has helped his team work more efficiently. “We now spend more time concentrating on our customers, customer service and our internal training programme, instead of having to spend hours on tedious tasks such as chasing paperwork.”


Smoother guest experience

As the above testimonial by Good Hotel’s former GM already points out, it’s not only staff who benefit from cashless transactions and modern payment methods.

Since using credit and debit cards or automated online payments is much faster than dealing with cash, guests have a better experience because they get served more quickly and transactions become less invasive. 


At check-out for example, guests can settle their bill within seconds, without even showing their card. They can even skip the line altogether if a hotel offers an online check-out option where the amount due can be paid online. 

To take things to the next level, the entire check-out could be fully automated, enabling guests to depart knowing the system will settle their bill. Apart from creating the most hassle-free check-out experience ever, this also protects hotels from walkouts.

Of course, even if you decide not to abandon cash at your property altogether, you can still offer guests the option of quick, cashless payments as a perk. More and more people will take you up on it!

As payments disappear into the background, personalized service and engagement once again become the priority, as staff have the time and energy to dedicate to their guests. 

Collection of valuable guest data and boosted revenues

Going cashless creates exciting new possibilities in terms of CRM. Some mobile payment apps and wallets, for example, allow hotels to segment guests and create automated, targeted discounts and promotions.

Also, when guests pay by card or sign to their room rather than using ‘real money’, they tend to buy more, simply because it’s easier. In a 2016 study, Clearscore, a London-based FinTech company, found that 59% of British consumers thought they spent more on cashless transactions and 72% insisted contactless credit cards have encouraged impulse purchases. 

Francois Leclerc, VP Brand & Operation at Jo&Joe, Accor’s first fully cashless brand, put it nicely in an interview on’s Partner Hub: “Payments are the least favourite part of anyone’s journey, so our philosophy of ‘no cash, no clash’ makes the experience as smooth as possible. Foreign currency transactions are simplified, fraud risk is reduced and ordering another plate of tapas is a no-brainer.”


Taking it one step further - implementing fully automated online payments

Modern payment solutions like the Mews Merchant don’t stop at simply switching all payments from cash to card. Today’s best systems move the entire payment process online and make it possible to charge cards without using physical terminals and manually inputting credit card details. This is known as ‘card not present’ transactions, something leading e-commerce businesses have already been using for years. Just think of Amazon’s One-Click purchase or Uber’s option to save your card and automatically bill you when you get out of the car.

This opens the door to completely new possibilities in terms of security, efficiency and – most importantly – guest experience.

Fully automated online payments allow convenient options such as online check-in and check-out for all guests. Just think of Airbnb, where in some cases you don’t even have to meet the host. If they can do it, shouldn’t hotels be keeping up?

Imagine a world where staff can welcome guests and immediately show them to their room, without having to hassle with a cash deposit, personal details or a credit card. Other guests might prefer to simply go to their room on their own because they’ve already checked themselves in online. The important thing is providing that option so that guests can choose the experience they’re looking for.

Come check-out, the situation is similar. Leisure travelers who value interactions and want a chance to thank the staff for their great service might be happy to do a personal check-out. Business travelers who want to get to their next meeting or catch their flight home will appreciate being able to skip the checkout line. And of course, anyone who oversleeps and is late for their flight or train will love the option of checking out online as they rush out the door. 

Iain McDougall, Country Manager UK & Ireland of Stripe, Mews’ trusted payment partner, said this about the way payment is changing: “Invisible payments are the future, where you only ask your client or your customer once for their payment credentials – irrespective of the channel they come through, be it online for the booking, or at check-out in the hotel or the property. It’s about making sure the payments are not intrusive.”

To some, the many new possibilities online payments create may seem a bit like science fiction. But isn’t that how we always think about the future of technology until it becomes real? 

Many hotels have already embraced cashless operations and haven't looked back since. Others are starting down the same road and quickly see the endless benefits of cashless, automated online payments. This shows that going completely cashless is no longer just a futuristic dream but a realistic prediction. 

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