Houston restaurants go cashless following recent trends

Restaurants accept only credit cards, debit cards, mobile payments

By Sara Donchey - Anchor/Reporter

HOUSTON - When customers walk in to Peli Peli Kitchen off the Katy Freeway, they're greeted with signs that tell them their cash is no good there.

The restaurant has embraced a new trend slowly gaining traction across the country -- they have gone "cashless."

Thomas Nguyen, co-founder of Peli Peli Restaurant, made the decision to ditch cash not only at his self-described "fast casual" location off the Katy Freeway, but at Peli Peli's upscale flagship location in Katy.

"We felt like this (accepting cash was) an archaic way to do things. I feel like with Amazon and with Uber, I think people are just generally getting used to the fact that their information is stored somewhere or you're paying for your transactions with a credit card," Nguyen said.

The restaurants do not have cash registers and accept only credit cards, debit cards or mobile payments.

Nguyen admits it was a drastic change, not just for his employees, but for surprised patrons, as well.

"We had a few issues in the beginning, but that was our fault in terms of failing to really properly inform people that this is a cashless environment," Nguyen said.

Now the restaurant displays signs outside, and the hostess at the Katy location informs guests of the policy before they are seated so that they aren't caught off guard.

For Nguyen and his partners, the largest motivating factor to make the change was keeping the restaurant and its employees and patrons from being victims of violent crimes, especially robbery.

"I'll be honest. The No. 1 reason we decided to go cashless was for the safety of our own employees," Nguyen said. "Their quality of life working for our stores is a little bit better just because all of them are home before midnight. They're not here in the late hours counting cash. They're not ever having to do cash deposits."

Cashless businesses are still a rarity in Houston.

Boheme, a Montrose bar and restaurant, has displayed signs saying they no longer accept cash to protect themselves from crimes.

VISA recently offered some business owners across the country $10,000 to go cashless.

The move follows noticeable trends of Americans favoring plastic over paper.

"People are increasingly paying with plastic, either through credit cards or debit cards, and carrying less cash over time. And that's a trend that's likely to continue," said Greg McBride, chief financial analyst of BankRate.com.

That trend was outlined in a 2016 study by the U.S. Federal Reserve that found while cash is still the No. 1 method of payment, non-cash payments grew by almost 400 percent from 2000 to 2015.

For Nguyen, being able to serve customers quickly is another added benefit to skipping on cash. However, there are drawbacks to the system.

"The obvious downside is that you might miss out on business from consumers that are unbanked or operate on a cash-only basis," McBride said.

Seven percent of U.S. households were "unbanked," or in other words, they didn't use a banking system in 2015, based on a study by the Federal Deposit Insurance Corporation.

And going cash-free carries hidden costs for merchants, as well.

"We're not doing this to primarily save money, because if you go cashless, your credit card fees will go up. Because every single transaction, you're going to have to pay a fee on," Nguyen said.

McBride said it could be a long while before we see society embrace "cash free" as mainstream.

"Until we figure out how to tip the valet or the hotel bellman very quickly and easily without cash, I think it's gonna be with us a while longer," McBride said.

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