Choice Hacking

Cashless Effect: How eliminating the “pain of payment” can improve your experience

Episode Summary

Have you ever found yourself giving a waiter a bigger tip when you pay with a credit card? How about splurging on that new computer you've had your eye on - are you more likely to put it on a card or use cash? Whenever people make a purchase, they experience something called the "pain of payment" - the more tangible a payment, such as cash, the worse the pain. The less tangible the purchase, like using a credit card, the smaller the pain. Why? It's an example of a behavioral science principle known as the Cashless Effect. In this episode, we'll explore the behavioral science of the Cashless Effect, and talk about how we can use it to our advantage in business, marketing, and experience design.

Episode Notes

 

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