Going cash-free newest trend for U.S. airlines

When Alaska Airlines begins to accept only credit and debit cards for in-flight purchases early next month, it will become the latest U.S. carrier to go cash-free.

Midwest, JetBlue, Virgin American, AirTran and Frontier have all stopped accepting cash for things like headphones, food and drinks. Instead, they require you to swipe plastic if you want something on board.

The reason? Airline officials say it makes service more efficient, since flight attendants now won’t have to carry money on them and be burdened with having to make change. And let’s face it: Since airlines are charging for everything these days, this kind of makes sense. Why make flight attendants fly with cash registers when they can make do with small electronic card machines?

But I have a question about this, which you may anticipate: If airlines are so cash strapped, as they claim, why not do the reverse and ban credit card purchases? Merchants pay a percentage of every credit card transaction (it’s usually small, like 1-3 percent). So by outlawing cash, airlines will be bumping up there own exposure to credit card fees. A few percents on every purchase might not seem like much, but it’ll add up (remember, this is an industry that concluded eliminating free salted peanuts would be a huge money-saver).

I’m guessing airlines will work the credit card fees they pay right into the price of their products. Don’t be shocked to see that lunch box climb up $.10-$.25 or so.

But some industry watchers say that going cashless won’t really do much to airlines’ bottom lines since in-flight purchases are not big profit sources for airlines anyway. If anything, they say airlines might see a slight uptick as people often spend more when using plastic.

Not all planes have gone cashless. Northwest still accepts cash on its domestic routes, and American and Delta accept both cash and plastic.