Can cashless technology transform the lives of homeless people?

As the public turns to contactless payments, the cash in their pockets for donations is drying up. 

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James Davis, a vendor for Street Sense, has been selling the street newspaper in Washington DC since 2003, when he became homeless.

Two years earlier, with two degrees in computer science and electronic technology, he was putting in long hours as an engineering technician. Everything changed when he suffered a nervous breakdown, which led to the loss of his job and his marriage.

He found out about Street Sense while living at the Central Union Mission men’s shelter – and jumped at the chance to rebuilt his life. In recent years, though, he began to notice a fall in people carrying cash – which meant a drop in his sales.

“That was something that was starting to happen more frequently, especially among millennials,” he says. “People weren’t carrying cash for whatever reason. Even somebody older, customers now just don’t carry much cash because of the fear of mugging, and other things too.

“I mean they show interest and they’ll talk to me, as far as they say they like what the paper is doing. They say ‘I’d really like to buy a paper but I don’t have any cash’ - I was getting that quite a bit.”

Davis isn’t alone with this problem. Studies have shown more than a third of people in the US and Europe would be happy to go without cash and rely on electronic payment. It’s the same story in the UK, where research by Barclaycard has shown four in ten consumers in the UK carry less cash than they did three years ago.

Seeing how this affected vendors, Street Sense launched an app last year to allow them to take cashless payments. Once the customer has bought the newspaper, the vendor can pick up their share of the cash from the paper’s offices within the same day.

“We let them know they can download the app and it takes less than a minute, and you put your card information on, then the next time you can come and purchase a paper,” Davis says. “And they’re like ‘OK! I’ll do that.’”

“It’s pretty positive – and they [customers] like it,” he adds. “Especially if they’ve got the app before and so now they can remember your name, even though we carry badges. They say ‘James, I’ve got a paper from you before – I’ve got the app’.”

These kind of schemes are on the rise around the world. In Sweden, the company iZettle has been working with another street newspaper called Situation Sthlm – sold by the homeless – to provide vendors with card-reader devices to take electronic payments.

In the UK, the social enterprise TAP London launched a similar vendor programme earlier this year. The pilot scheme, which ended in March, allowed homeless vendors to raise money for homeless charities and earn an income by selling cards designed by local artists. Buyers paid via a contactless “box” that could be worn around the vendor’s neck. The scheme also gave homeless people a chance to tell their personal stories, which helped increase donations and provided respite from the loneliness of living on the street.

“It is so boring being homeless, particularly in the day,” says Danny, a former TAP London vendor. “All the services are closed and I just spend the afternoon riding buses. Working for TAP gives me something to do, a sense of structure and self-esteem. I feel like a human again.”

Katie Whitlock and Polly Gilbert, TAP London’s co-founders, began researching contactless payments and homelessness for a year before launching the enterprise in 2017.

“We enabled people who were ready to work to be earning London Living Wage within just a few days, and paid that week,” says Whitlock. “We spent a lot of one-on-one time with vendors, developing their confidence, and working with them to envision a future away from the streets.”

As is the case with any new schemes, though, the programme came with challenges. One issue was recruitment, Whitlock says. “We had some support from charity employment services, but undertook much of the recruitment ourselves; roaming London’s streets chatting and handing out interview slips. But we quickly realised that whilst employment is a significant part of the jigsaw for a life away from the streets, it is just one piece,” she says.

Substance abuse and mental health problems – often a cause and consequence of homelessness – also posed an issue for those trying to get back into work.

“We operated with a spirit of honesty at the office at all times, and worked with one of our vendors to ensure that his recovery always came first,” Whitlock says. “Unfortunately, in the last month of our operations another of our vendors relapsed back into drug use. It was extremely harrowing.”

On the other side of the Atlantic, Davis says that overall, using cashless technology has been an extremely positive experience for him and others selling Street Sense.

“It makes it easier on the vendor,” he explains. “A lot of times some of our vendors are not that outgoing sales-wise, so if somebody already has the app that knows there is a vendor in that area, then they will approach that person. It helps a lot of vendors in that respect.”

Davis adds that rather than accepting a few dollars for the newspaper, the app allows people to donate more money than they would carry on them in cash.

“Quite a few vendors have been using the app. Some of them are doing a lot better than I am,” he laughs.

“I can say across the board that most of our vendors who weren’t doing that well before the app are now doing a lot better – the reason being that of course people have more money in their bank account than they carry on their person, so somebody can go on the app and take $20 out of their bank account and make that donation to the vendor.

“Before, they only had $5 or a couple of dollars in their wallet so that’s what they would give. Now they can give more.”

Our cashless society isn’t just impacting vendors like Davis, but also affects fundraising by charities, who risk losing out on £80m a year by only accepting cash donations, according to Barclaycard.

Although TAP London’s vendor scheme ended in March, but the organisation is set to launch another project later this year to address this problem – unattended contactless units will be fitted across the city to allow people to donate £2 to homelessness charities.

“100 per cent of their donation will be split between local homelessness charities,” Whitlock says.

“There are a number of amazing local charities, but it is incredibly difficult to find them and give them support, so we hope TAP London can bridge this gap. No other method of giving has such galvanising power; through small action from individuals, we can create huge change in London.”