Musicians test DipJar to collect digital tips

The tip jar is a fixture in most bars that host live music.

But as more people forego cash in favour of electronic payments, there’s that awkward moment when an audience wants to show a band their appreciation but just don’t have anything in their pockets that’s not plastic.

A Texas company is looking to change that with an electronic tip jar that allows patrons to tip using their credit or debit card.

A pilot program just launched in Austin – where else? – with 10 artists getting a device called DipJar.

For the next six months, the artists will use the device to collect tips electronically while touring or if they have a steady gig in a particular location.

DipJar costs $399 per unit, a price that includes the first year’s coverage. After that, the device is $99 per year.

The company also collects six percent and 17 cents from every transaction, meaning a $5 tip would provide $0.47 to the company and $4.53 to the band.

The pilot project was announced in May by the city’s Music and Entertainment Division.

“The ‘Tip the Band’ program aims to address affordability concerns for Austin’s music community by creating a new and convenient revenue stream for musicians,” the Austin Economic Development Department said. “Selected musicians will be required to market and promote the use of the ‘Tip the Band’ program alongside a promotional campaign by the Music & Entertainment Division. Following a six-month evaluation period, and upon submitting a final report, the band may continue utilizing the vessel to collect tips.”

Musicians get something else from the pilot – DipJar “can provide you with the donor’s first and last name, the time and date of the dip and the amount of the donation,” the company says.

It’s unclear, but it appears whoever uses a DipJar can set a predetermined amount for each transaction.

“The preset dollar amount is adjustable,” the company says. “You cannot change the amount directly on the DipJar; however, you are able to make adjustments through your online dashboard. The amount can be changed from $5 to $1,000 in less than five minutes.”

The same technology has been around for about five years and has been used by nonprofit organizations for fundraiser and special events, but this is the first use for bands.

What do you think? Would you be more inclined to tip if it can be done directly to the band from a card?

Musicians, does that off-the-top fee, of six percent plus 17 cents per transaction, seem fair?