‘Sorry, I don’t have any cash!’

A DipJar in the pilot program on the counter at Oren's Daily Roast, a coffee shop in New York

I’ve had service jobs nearly all of my professional life, starting when I was 10-years-old and delivering newspapers by boat on summer Sundays. 

I charged $1.50 per paper and usually got at least a $5 cash tip. Later on I pumped gas, parked cars, cleaned houses and waited tables, among the many minimum wage jobs I worked through high school and college. 

In other words, if anyone should appreciate the importance of cash tips it’s me. But a few days ago, there I was at my favorite ice cream stand using my debit card to pay, with nothing to put in the tip jar. I tried to look the college-bound (and likely cash-strapped) scooper in the eye as I apologized, but I felt guiltier with every bite of my chocolate-chip cone. 

Like a growing number of consumers these days, if I have cash in my wallet, it’s probably not on purpose. I hate paying steep ATM fees to get cash and when I do have it on hand, I spend it too fast. But for the most part, I’ve stopped carrying spare change and paper money because it’s so much easier to pay with plastic.

Americans’ use of cash alternatives, including debit cards, credit cards, mobile apps and other electronic payment methods, is increasing dramatically.  By 2017 only 23 percent of all point-of-sale purchases will be made with cash, down from 27 percent in 2011, according to a report from Javelin Strategy & Research. 

So where does that leave the legions of service workers who rely on tips to supplement their incomes? That’s everyone from taxi drivers and skycaps to baristas and beauticians.

“Tipping technology has not kept up with payment technology,” says Judd Kessler, co-founder of DipJar, a New York City start-up that makes electronic tip jars. He says his partner got the idea for the company after hearing employees at his favorite coffee shop complain that cash tips have dropped sharply since more people started paying with credit or debit cards.

DipJar lets customers dip their cards into a slot to pay a pre-set tip ($1 for most locations).

“Our pilot program has shown us that, yes, people still want to tip, and show appreciation for work that’s being done for them,” says Kessler.

The device is one of several electronic gratuity solutions for cashless consumers; there are a growing number of mobile apps with tipping technology, such as LevelUp, ZipTip and Square wallet.  

“I like that these new systems are coming but you can’t count on them yet,” says Daniel Post Senning, the great-great-grandson of etiquette guru Emily Post, and author of the e-book "Manners in a Digital World."  For now he says tipping habits are up to each consumer and their moral compass.  “The spirit of gratuity is thanks; it’s the root of the word.  I like to pay it forward and reward good service, but it’s not an obligation.  There is no tipping police.”

Post Senning suggests carrying cash when you’re going someplace where you might expect service.  As ATMs go the way of the phone booth and cash gets harder to come by, he says gratitude still goes a long way, and a sincere apology can’t hurt. 

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