Making Change

Chapter 3: The New Normal

This is an installment of Making Change, an ongoing series of reports based on Square data (September 2020).

As we adjust to the new normal, we continue to monitor how the onset of COVID-19 is affecting consumer spending behavior globally, and we are starting to realize what the long-term impact may look like for business owners and consumers. Since our last report, most countries have slowly started to reopen, loosening shelter-in-place mandates. As a result, we’ve seen increased in-person transactions, causing the share of cashless businesses to stabilize since they peaked in April. That said, there has still been a remarkable increase in cashless adoption rates compared to pre-pandemic, coupled with a notable drop in the share of cash payments. In the United States, we estimate this recent shift away from cash usage would have taken more than three years without the pandemic.


Share of Cashless* Businesses Compared to COVID-19 Cases

We analyzed Square payments data to assess the share of cashless businesses across the U.S., relative to the spread of COVID-19 from February to August 2020. We've seen the share of cashless businesses stabilize from June through August as COVID-19 cases continue to rise.

*For the purposes of this report, cashless businesses are defined as those that are accepting 95% or more of payments via cashless methods (in-person debit, credit, or contactless payments, Square Online payments, or card-not-present payments).


Share of Cashless Businesses by Industry

From salons to restaurants to in-home repair, business owners across different industry have been uniquely affected by various shelter-in-place mandates and safety precautions over the course of 2020. Here, we compare the share of cashless businesses over time, by industry.


Cash Usage Over Time

Since the onset of COVID-19, consumers have become less reliant on cash.

Among payments transacted at Square sellers nationally since February 2020, the share of cash transactions decreased from 37% in February to 33% in April, and held stable at 33% through the end of August, proving that the onset of COVID-19 has affected consumer behavior.

By comparison, during that same time period in 2019, the share of cash transactions increased slightly, from 39.9% in February to 40.0% in August.

Share of Cash Transactions


Growth of Online and Contactless Payments Contributes to Cashless

From February 2019 to February 2020 the share of cash transactions dropped by 2.5 percentage points from 39.9% to 37.4%. Comparing that with the year over year change for August, we see a 7.4 percentage point drop (40.0% to 32.6%). So using last year as a gauge, a change that would have taken roughly 3 years has happened in one. Within the realm of cashless payments in the time of COVID-19, both online and contactless options have become increasingly popular among business owners and consumers alike.

Online Payments

From February to July 2020, we saw a 13.2 percentage point increase in the share of Square sellers accepting online payments.

Contactless Payments

From February to July 2020, we saw a 6.6 percentage point increase in the share of Square sellers accepting contactless payments.


Share of Cashless Businesses Across International Markets

For a global perspective, we compared the monthly share of cashless businesses across each of Square’s international markets. From Japan to the UK, Square sellers are adopting cashless business models at noticeably different rates throughout the many phases of the pandemic.