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Stay away from the Russell Investments Center in downtown Seattle if you want to pay for a Frappuccino with a Hamilton.

Mike Pomranz
January 18, 2018

For plenty of working Americans, the morning Starbucks stop is part of their daily routine – a chance to grab a caffeine fix on the way into the office. For these people, speed is key, lest they arrive late into the office for a dreaded “one more time.” And frankly, pre-coffee, minimal dealings with a cashier can also be a major benefit. So customers of that ilk might applaud this latest move from Starbucks: The coffee giant has begun testing a cashless location in downtown Seattle, turning the store into a card and phone payment only endeavor.

The Starbucks location in question – located inside the Russell Investment Center and described by the Seattle Times as “posh” – stopped accepting cash on Tuesday. Starbucks reportedly said this location is the only that’s gone cashless but declined to comment on how long the test might last. Interestingly enough, the store apparently hasn’t even posted a sign announcing the change in payment policy – but then again, maybe that’s part of the experiment. “The test will help us understand how cashless forms of payment may impact our customer experience,” a Starbucks spokeswoman told the Times. As an additional astute observation, the paper noticed that tips for baristas were still being accepted in cash via a tip box.

Though axing cash payments is the big story here, Starbucks may have an ulterior motive up its sleeve: The company has continued to invest in and see growth in its mobile app which allows people to pay through their phone. Though getting rid of physical money can make life a bit easier – by speeding up transactions, reducing theft and eliminating bank runs – it could also drive even more people to turn to the company’s mobile app to handle purchases. And keeping people on the mobile app puts a lot of money into Starbucks’ pocket: As of 2016, Starbucks customers had $1.2 billion loaded onto Starbucks cards and the Starbucks mobile app according to a MarketWatch report. It begs the question, why let people hold their own money when Starbucks could be holding it for them?

Tellingly, the Seattle Times also reported, “Signs at the Russell Center store do encourage customers to ‘Skip the Chip’ of a credit-card purchase by using the mobile payment app.” Maybe credit card payments could be the next to go?

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