Cashless society warning as nearly half expect money to vanish within their lifetime | Personal Finance | Finance
Nearly half (48 percent) of individuals anticipate a cashless society within their lifetime, according to a recent survey.
The study found that one in six (15 percent) people never carry cash, a figure that has tripled from four percentin 2019.
Link, the cash access and ATM network, revealed that the percentage of people expecting the UK to become cashless in their lifetime has risen from just over two-fifths (41 percent) since similar research was conducted in 2019.
Despite this, seven out of ten (71 percent) respondents still rely on cash daily, stating they had used it in the past fortnight.
Link’s data indicates that UK consumers are withdrawing £209 million per day from ATMs, although this is around a third, or £100 million, less than in 2019.
Almost half (48 percent) of respondents expressed concerns about a cashless society.
In 2023, legislation was enacted under the Financial Services and Markets Act to safeguard access to cash.
Consumer group Which? reported last Friday that the number of UK bank branches closing in the past nine years has hit the 6,000 mark.
Various initiatives are being implemented to fill the gaps in the cash access network caused by bank branch closures.
The 50th banking hub was recently inaugurated. These hubs allow banks to share facilities and include a counter service operated by the Post Office, enabling customers to carry out routine banking transactions.
The Post Office recently announced that cash transactions at its branches reached a record £3.48 billion in April. In addition to post services, The Post Office also offers banking services at many of its branches via an agreement with numerous banks.
John Howells, Chief Executive Officer of Link, commented: “Although the UK is on the way to becoming a low cash country, we now have legislation that will help Link maintain a national network of free ATMs and banking hubs and this will ensure that anyone needing to access cash can do so.”
However, he underlined the issues around digital availability saying, “But it’s no use having cash if the best goods and services are only available online and this is becoming a real problem for millions of cash-reliant consumers. The focus now needs to be on access to digital.”
Natalie Ceeney, Chair of the Access to Cash Review, remarked: “Despite a massive growth in digital payments over the past five years, there are still millions of people who depend on cash, and half of the UK population concerned about the prospect of a cashless society.”
She highlighted the dependency of many on physical currency for a range of reasons, adding, “People need cash for a wide range of reasons, and the barriers to using digital payments are very real.”
Ceeney concluded: “We are certainly not ready to become a cashless society.”
Lord Holmes of Richmond, the vice chair of the All-Party Parliamentary Group on FinTech, has raised concerns about the UK’s digital shift, saying: “We are clearly heading towards a digital future and while some of the benefits will be transformational to society and the economy, there is a clear and present risk that we are moving forward without a clear plan to bring everyone on that journey.”
He warned of current issues, noting: “There are already real-life examples where the shift to digital is penalising those who can’t use tech at the moment. This should be an opportunity to bring everyone forward and we cannot afford to waste it.”
Emphasising the link between financial and digital inclusion, he stated: “Financial inclusion and digital inclusion are so inextricably linked. We need to enable both.”
Meanwhile, a spokesperson for UK Finance acknowledged the trend away from cash, stating: “While many people choose to pay using card, there are still plenty of people who prefer to use cash.”
They added: “The number of cash payments has decreased over the last decade and we expect cash usage to continue to fall, however, the finance industry is committed to ensuring access to cash for those who want to use it. Firms also have support and guidance available for anyone who needs help with using digital banking services.”
The findings come from a YouGov survey conducted in April, which included responses from more than 2,200 people across the UK.