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Why paying in cash connects us to products


Going cashless is undeniably convenient. With the swipe of a card, I can pick up groceries on the run. With the click of a button, I can pay bills or make a charitable donation. I rarely carry cash in my wallet anymore.

And I’m far from alone. Over the last 20 years, there has been a major shift from paper (cash and check) to plastic (debit and credit) as a preferred form of payment. Throw in mobile apps that let consumers pay with their phones or smart watches, and the movement away from paper seems irreversible.

Yet we may have lost something in the process — attachment to our purchases. Paying by cash or check increases the value of the purchase to the consumer, according to a study published earlier this year in the Journal of Consumer Research. Paper payment can even lead a person to feel more loyal to a brand or more likely to repeat a donation to a charity.

“You’re more willing to show public support and behavioral commitment to a particular thing you’ve put your cash toward,” says lead author Avni Shah, an assistant professor of marketing at the University of Toronto.


Shah initiated the study after a simple incident: One morning, she paid cash for her regular latte after forgetting to bring her debit card. Shah felt a pang of pain handing over the $5 bill. That’s not surprising, as previous research has shown that the pain of payment — a negative feeling consumers experience when parting with money — is stronger with cash versus credit transactions. It simply hurts more to hand over bills.

But as she drank the latte, Shah found herself perseverating on how good it tasted that day. Then a marketing graduate student at Duke University, Shah conducted four experiments to test whether pain of payment might have an upside: a field experiment, a lab experiment, an online experiment, and an archival data analysis.


In each situation, individuals who paid using the more painful form of payment — cash or check — felt more connected to the product they purchased or the organization they donated to than those who paid with debit or credit.

In the field experiment, for example, Shah sold mugs to 98 people for $2 each. Two hours later, she returned and asked to buy the mugs back. Those who originally paid with a card sold the mug back for an average of $3.83. Those who had paid cash requested an average of $6.71, demonstrating that they valued their purchase more than those who paid with a card.

But did they also feel more emotionally connected? In the lab experiment, Shah and colleagues gave 94 college students $5 each — in the form of either cash or a voucher — and asked each student to make a donation to one of three charities. Those who donated cash reported feeling more connected to their charity than those who donated by voucher, and were more than three times as likely to wear a lapel pin showing public support for their charity of choice.

The results suggest pain of payment is not necessarily a bad thing for a person, or even an organization, says Shah, who uses cash all the time. Local businesses can encourage customers to use cash as a way to build loyalty, she notes. And individuals can pay cash to feel more committed to a purchase.


“In this day and age, it’s important to feel that connection,” she says. “We’re in a consumer culture now of more, more, more — and that’s not good for our wallets or for sustainability.”MEGAN SCUDELLARI