They say cash is king but with the growing number of digital payment options being rolled out to the public, its little wonder the clink of coins is being heard less and less by the day. And new research from the Payments Council has revealed the extent to which people are ditching their cash for cards.
Its study found that total non-cash payments overtook cash for the first time last year, with the total number of cash payments made by consumers, businesses and financial organisations falling to 48%, down from 52% in 2013. This was compared to card payments and cheques, which accounted for 52% of all transactions made in 2014.
But despite this apparent gravitation towards cashless payments, cash is still the favoured payment option in volume terms, with 18 billion cash payments made in the UK in 2014, while debit cards accounted for a mere 24% of transactions and direct debits 10%. Predictably, the cash hotspots of 2014 were pubs, clubs and newsagents, where 80% of transactions were completed with notes and loose change.
Cash also remained the most popular payment method among consumers, who used it for more than half (52%) of all their transactions in 2014. While this figure is expected to drop below 50% in 2016, figures from LINK, the UK’s cash machine network, showed that the number of cash machines grew to a new peak of 69,382 last year, suggesting that Brits won’t be giving up the cash altogether anytime soon. Free-to-use cash machines continued to crop up across the nation with an increase of 5.2%, surpassing the 50,000 milestone mark for the first time, and he total number of people using cash machines has also grown year-on-year. The majority of people that used a cash machine in 2014 used them often, with 91% of Brits withdrawing cash from an ATM at least once a month.
So while cash isn’t yet entirely redundant, businesses that restrict themselves to cash-only payments could well be hindering their chances of success by overlooking the ever-growing pool of plastic-wielding patrons.