News Disney to pilot electronic-only transactions at its resort hotels

[seascape]

Not to be completely off-topic, but that's not the full story. Merchant and transaction fees are what turn the engine, not just interest. AMEX, for example, made their start entirely on transaction fees as they didn't allow balances on their charge cards. Clearly, the interest game is a major benefit, but merchant fees are still the bread and butter and outearn the interest for several banks.
There is a reason the super-premium cards offer huge signup bonuses, give mega points, and have insane APRs of 25%+. Yet they only go to high credit scores with good credit history and good incomes. People who generally won't ever carry a balance. Why? They charge more for those particular transaction fees.

To dumb it way down. An order costs $10 at the grocery store. Someone pays cash for the order- store makes $10, right? Now, I go and buy that same $10 order with a super-premium card that charges the grocery store 2.1% + .10 on the transaction. That $10 order now has a merchant fee of $0.31- meaning the grocery store only makes $9.69 on that transaction. Does the supermarket just take the hit on that and lose 31 cents profit? No- they raise the price to $10.31. Now I pay $10.31 and get 3% back (which, coincidently in this case is 31 cents)- making my net purchase still $10. Meanwhile, cash person spends $10.31.

Hence, they subsidized my points and the big bank earns more.

Spoiler

https://loopholetravel.com/2017/01/25/looking-loophole-really-pays-rewards-part/
https://loopholetravel.com/2017/03/02/looking-loophole-really-pays-rewards-part-ii/
https://loopholetravel.com/2017/03/14/looking-loophole-really-pays-rewards-part-iii/

However I get 3% on everything I buy at WDW because everything goes through the resort room and then I get a 50% bonus because I only use my points for rental car and airline tickets. So I a m subsidized by people who pay interest. My bill runs thousands of dollars each trip so using your numbers 2.1% plus 10 cents per transaction the total cost to WDW may be 2.11% but I get 4.5%.

 

[beertiki]

That is the reason I stock up on liquor (we don't drink), and chocolate. They will be the new forms of currency if the grid goes down. ok, I'm kidding. But, we do still use cash for tips. Will this effect all the carts, too?

In the pre hurricane Irma mess in Key West, the ATMs ran out of cash. I had a friend nervous to be without cash, then I told him to go buy whiskey. He bought several bottles of his regular brand. I figured it would be easier to trade a bottle of whiskey for what ever was needed, and in a SHTF situation, the whiskey would be worth more than the cash due to inflated prices in an emergency situation. For a long time, stores were empty and closed, he was much happier with the whiskey than the cash.

 

[Lets Respect]

This seems logical to me as long as there is an option at the Front Desk to put cash on your account. I don't see the big deal.

 

[joshwill]

id like to see them enable linking your magic band to your credit card even if your not staying at a resort. that would be a big plus for the locals.

 

[BoarderPhreak]

Ironically, my last stay was at AKL Jambo... And I never used cash once during my entire stay, including the shop inside the resort. MagicBand all the way.

Of course, like taking a cruise (which is also cashless) - the surprise comes when they slip your final total under the door the morning of checkout!

"I spent WHAT at the bars?!"

 

[The Blue Fairy]

"The resort will continue to accept cash for tips." Of course they will......

Garage sales and tipping are the last vestiges of a cashless society.

 

[Coaster Lover]

I will say (and I'm ALL about being cashless), if the ultimate plan is to move WDW Resort to be more cashless, I wish they would come up with an easy/efficient means to offer cashless tips (i.e. tipping electronically). Having a method to tip your Magical Express driver and your mouse-keepers (amongst others) in a cashless manor would be incredibly convenient for me...

 

[dvitali]

Remember this only at resorts, you still can spend cash at the park. I am still one of those people who refused to use credit under certain amounts like for popcorn and soda.

 

[peter11435]

Remember this only at resorts, you still can spend cash at the park. I am still one of those people who refused to use credit under certain amounts like for popcorn and soda.

At this point it’s only a test at one Resort. There is no telling how extensive it might become if it proves successful. It might be just resorts or it could expand.

 

[Rumrunner]

It must be a rough 35 years or so for you...

Actually we use a combination of cash, magic bands, and credit cards. On our last trip to Disney I received a bill that was three times what our actual card charges were. It seems someone else had the same last 4 digits in their credit card-at least that was the explanation. It took 3 months-countless phone calls-some consternation-to get it all straightened out.
Never had that problem with cash transactions.

 

[yensid67]

When I read this it actually gave me the creeps! What happens if this is rolled out for the entire property and you don not have any type of electronic way to pay!? Disney is that case, is limiting those who can vacation at Disney! BUT I see Disney offering their own type of card that guests can dump their vacation cash on when they get to property and use it that way! Disney own their own Credit Union, they could work a deal through Vista Credit Union!

 

[larryz]

While I certainly use cards and an electronic wallet, we primarily use cash as it's an incredibly effective budgetary tool. Having been an owner of a business for quite a long time, having guests pay for everything including the smallest of transactions with credit cards really eats into margins, but a huge outfit like Disney most likely sees the numbers that they'll eat the lower margins on small transactions because people on average spend more when using credit versus cash. As it was mentioned before, there can be major savings not having employees having to process and account the cash behind the scenes, but many large multinationals are eliminating those positions and using machines to do that job making the labor cost a moot point.

When you're selling $7 t-shirts for $29.99, what's a 3% transaction charge? (Rhetorical -- nobody has to actually do the math here...)

 

[dreamfinder]

I hope you have no foreign transaction fee type card

For personal travel, gotta love Credit Unions. No int'l credit card fees, and ATM fees are refunded if I need to get local cash. Business travel, who cares? ; )

When you're selling $7 t-shirts for $29.99, what's a 3% transaction charge? (Rhetorical -- nobody has to actually do the math here...)

3% over thousands of t-shirts? That's a low level VPs yearly bonus.

 

[ThistleMae]

I have a small store in my town that won't accept credit cards unless you spend at least $ 15.00. It forces you to spend that much or shop elsewhere, but they happen to be the only health food store in that town, so if you want something and you don't have cash, which I hardly ever have, you have to spend $ 15.00.

 

[tissandtully]

eliminating cash drawers takes a lot of overhead out of your system. Move to magicbands, and you move a lot of risk for employee fraud out of your POS network too. Move more transactions to Magicband, and you improve your batch processing with the banks.

All of this is little bits that add up to optimizing the POS network for Disney. Take such a change to property wide.. and the saving really start to pile up.

I have to imagine the biggest resistance to doing this outright is the transient nature of alot of guests on property. Unlike a cruise ship where everyone has committed and signed up for a duration... WDW has a lot of 'just here for a bit...' type customers who haven't committed to WDW as the centerpiece of their trip. To those customers, such constraints seem like burdens. But in the same breath... I can't believe they haven't forced the topic already. All cashless minus DisneySprings. Call it now.. by 2020?

Do the balloon guys take cards or MB?

 

[HauntedPirate]

At this point it’s only a test at one Resort. There is no telling how extensive it might become if it proves successful. It might be just resorts or it could expand.

Just a guess on my part: I can see this moving to all resorts eventually, but not explicitly in the parks. However, the cash-less "thought" will be eventually stuck in resort guests heads enough that there will be a significant reduction in cash transactions in the parks.

 

[Roakor]

Contractors? Repair shops? Sure...they've been doing under the table since the beginning of time.

But restaurants?

any cash business can, and usually does to some degree, slip money under the table. Its simple really. you hand me cash for your dinner/service/product. I put said cash in my pocket and just never record the sale. Its really easy with a restaurant as there is not much in the way of inventory to track. How are they going to prove you sold that steak? Maybe you just threw it out because it went bad? Or the customer didn't like it so you gave them another one. Or it got dropped on the floor. Its not like there is any evidence left that the customer ate it, or at least not any anyone is going to want to look at.

 

[BoarderPhreak]

It would be nice if you could see the bill you're racking up on MDE. Beats going to the front desk for a printout... But I think if it were "too easy" then people might freak out at how much they're spending - and spend less.

 

[HauntedPirate]

It would be nice if you could see the bill you're racking up on MDE. Beats going to the front desk for a printout... But I think if it were "too easy" then people might freak out at how much they're spending - and spend less.

This is exactly why Disney wants cash-less transactions as much as possible. If you don't know/keep track of your spending and only get the final bill, well, it's too late to cut back at that point.

 

[ThatMouse]

This is exactly why Disney wants cash-less transactions as much as possible. If you don't know/keep track of your spending and only get the final bill, well, it's too late to cut back at that point.

While I love the Magic Bands for payment, it's safer to use a credit card where not only can I dispute charges individually (instead of the whole bill at the end), I can also see all my transactions in real-time and even go back and handle it right there if they charged me twice for something.