After eliminating "super-sized" fries and adding salads for the health-conscious, McDonald's (NYSE:MCD) has taken yet another step forward.
In what has traditionally been a cash business, the company said yesterday that it will accept more cashless payment options -- meaning credit and debit cards. Though terms were undisclosed, the fast-food giant announced alliances with credit card companies American Express (NYSE:AXP), Morgan Stanley's (NYSE:MWD) Discover unit, Visa, and Mastercard. It will also accept debit cards using First Data's (NYSE:FDC) STAR network.
Currently, 3,000 McDonald's restaurants accept cashless payments. By the end of the year, McDonald's expects that number to more than double. Cashless payments will be accepted at both counters and drive-thru windows.
It's about time.
I don't know if this necessarily generates sales, but it is definitely a convenience customers can appreciate. Though not a direct competitor, Steak n Shake (NYSE:SNS) recently became an easier choice when it began accepting credit cards, and Wendy's (NYSE:WEN) began accepting credit cards at many locations last year. And, as McDonald's suggests, you can expect to see some operational efficiencies from speedier pay options, including a whole lot less fumbling around with cash and coins.
Think of it as upgrading the intake on your car to improve airflow and horsepower. Come to think of it, McDonald's is improving its outflow, too. At any rate, investors seem to like the idea. The stock got a small boost on the news yesterday, climbing 3% to finish the day at $28.45.
What do you think? Give us your take on the McDonald's discussion board.
Fool contributor Jeff Hwang owns shares of American Express.
