UK Finance Reports 11% Decline In Cash Payments Since 2015
Published on Aug 15 2017 10:47 AM
According to UK Finance, the number of cash payments in Britain fell by 11% between 2015 and 2016, with consumers and businesses making 15,4 billion cash payments in 2016, reported Breakingnews.ie
Despite cash still being the most frequently-used payment method in the UK, it represented only 44% of all payments made by consumers and less than 4% by businesses in 2016, making it the second year during which consumers used cash for less than half of payments.
On the other hand, debit cards are on the rise, being the second most frequently-used payment method with 11,6 billion payments recorded.
UK Finance noted that the average value of a cash payment has increased over the last 10 years from £11.58 in 2006 to £15.80 in 2016, due to both inflation and changing consumer preferences.
The number of cash payments made for less than £1 has halved during the past decade, slowly being replaced by contactless ‘tap and go’ card payments that have become an increasingly popular alternative to cash when people are paying for low-value items, according to UK Finance.
Some 2,9 million people rarely used cash in 2016, while 2,7 million relied almost entirely on cash to make their day-to-day payments, representing 6% and 5% of the UK’s adult population, respectively.
People in younger age groups are more likely to be rare cash users, with more than one in 10 of those aged 25 to 34 making one cash payment each month or no cash payments at all. On the other hand, people on lower household incomes are far more likely to rely mainly on cash, with more than half of all consumers relying mainly on cash having household incomes of less than £15,000 per year, UK Finance reported.
During the next decade, the number of cash payments is forecast to fall by 43% to 8,7 billion payments.
"It is clear that over the past few years we have witnessed a significant shift away from cash use in this country with contactless cards undoubtedly causing a decrease in the use of notes and coins,” said Adrian Buckle, chief economist at UK Finance.
However, he does not believe that the UK is ‘on the verge of becoming cashless’: “People will always want to choose the payment methods that best suits them and, for the foreseeable future, in lots of cases that will continue to be cash."
© 2017 - Checkout Magazine by Larissa Zimmer