There’s a cash machine in the Himalayas at 15,000ft, and in Antarctica – at the McMurdo research station. The ATMs in the Vatican City give instructions in Latin. These ubiquitous devices have been making our lives easier for over half a century.
Now, with contactless payments, PayPal, cryptocurrencies and e-commerce making life easier without banknotes – how close are we to a cashless society?
data from banking body UK Finance, one in 10 adults are living a largely
cashless life. In 2017, debit card use – driven
by contactless payments – overtook the number of payments made in cash in the
UK for the first time.
Cash machines and bank branches are disappearing as the digital era advances. London buses stopped accepting cash in 2014, and it’s increasingly common to find bars and cafés that only take card or app payments. Even Hasbro has brought out a cashless version of Monopoly. Its ‘voice banking edition’ digitally keeps track of players’ transactions.
Sweden is considered the world’s first cashless society, with an 80% digital transaction rate. But how close is the UK to reaching this kind of ‘no notes’ economy?
Many of our financial institutions favour going cashless. It’s easier to prevent and monitor potential criminal activity – and cheaper than producing, storing and transporting coins and bills.
However, a cashless society would disadvantage many people, according to the 2018 Access to Cash review. It concluded that more than 8 million UK adults would struggle to cope. Some 15% of those earning under £10,000 a year rely completely on cash. There are 1.3 million adults without a bank account, according to the Financial Conduct Authority (FCA) and 4.1 million in financial difficulty who can’t easily access credit, so digital payments aren’t always an option.
That’s not the only evidence that we aren’t all ready to embrace e-payments. Last year, the government proposed scrapping £50 notes and 1p and 2p coins due to a decline in demand, but the resulting backlash soon saw them backtracking on the proposal.
UK Finance predicts that by 2028, cash payments will fall to 9%. So, while a cashless society may feel like an inevitability, it looks like we won’t be parting with our readies just yet.
Crystal are here to help you manage, grow and protect your money, so speak to one of our specialists for a free, no-obligation financial review. To speak to a member of the team call us on 01270 446600.