Oktoberfest in Munich is not entirely cash, but it is the most common and acceptable form of payment at the festival. Most places do not accept cards for individual orders. Some large tents, stalls or rides may accept cards but you cannot always count on them. Cash is what you can trust to get by.
Many vendors offer prepaid cards or beer tokens, which can be loaded with cash and used for purchases inside the tents. Mobile payments or credit cards are also becoming common but are not widely accepted. There are ATMs on the festival grounds and in big tents, but banks do not run them and may charge you high fees. It is better to get cash before you arrive to avoid inconvenience.