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Brits ready to ditch cash for cards

07 October 2016  |  12453 views  |  7 20 pound note

In its latest salvo against notes and coins, MasterCard has posted research showing that 44% of Brits would ditch cash altogether if card payments were accepted everywhere.

Of 2000 people polled, 62% say that they now prefer to pay electronically than with cash and 69% say they already use e-payments more often than notes and coins.

Those aged 25 to 34 are most keen to stop using cash, with 62% saying they would pay only with card if it was universally accepted. More than half (53%) of people aged 16 to 24, and from 35 to 44, felt the same.

Security is a factor for many when it comes to their choice of payment method, with two in five uncomfortable carrying cash for fear of losing it or having it stolen, whereas misplaced or stolen cards can be cancelled.

Cards have become so ubiquitous that 38% say they feel inconvenienced when a shop does not accept them. Well over a quarter are surprised and one in five are even annoyed, with younger generations most likely to be frustrated. A further 20% avoid or walk out of shops and restaurants when they realise that they don’t accept card payments.

A quarter of consumers think cash will cease to exist within their lifetime - rising to two in five among those aged 25 to 34.

Yet, while Brits - and MasterCard - may be keen to see the back of cash, the hard data does not suggest that physical money is on the way out.

Just this week the Bank of England noted that the amount of cash circulating in the UK economy is twice the level of a decade ago, with the much hyped growth in contactless cards and mobile P2P making little headway in reducing the amount of notes and coins in people's pockets.

Comments: (7)

Peter Robinson
Peter Robinson - Liberti Consulting - Northampton | 07 October, 2016, 09:30

Personally speaking, I don't think it's JUST about having the ability to accept cards, but the SPEED with which card transactions are processed. The card payment terminal at my local train station insists on going on-line for every transaction irrespective of the value. You wouldn't believe the queue that creates each time a train arrives. Get the process right and consumers will follow .....

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Melvin Haskins
Melvin Haskins - Haston International Limited - | 07 October, 2016, 10:27

And Finextra published a report a few days ago from the Bank of England stating that the amount of cash in circulation in the UK has doubled in the last 10 years. 

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Russell Bell
Russell Bell - Fastbase Ltd - Wellington | 10 October, 2016, 04:06

Feels like another tentative sally in the anti-cash PR war, the goal being first to make cash more expensive by introducing a cash "exchange rate" vs bank deposits and later to abolish the folding stuff altogether.  Because you can't have negative interest rates for retail deposits unless you outlaw cash.

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A Finextra member
A Finextra member | 10 October, 2016, 09:44

Getting retailers to take cards (however hard that may be) is the easy bit.  It's interpersonal payments where cash is still king.  If I mention Paym or any other personal payment apps to my friends, they all look at me as if they've never even heard of a smartphone.  Until one of them floats to the top like WhatsApp did in messaging, cash will always be needed.

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A Finextra member
A Finextra member | 10 October, 2016, 09:44

"44% of Brits would ditch cash altogether" - so 56% (the majority) wouldn't - not quite ready...

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John Candido
John Candido - Black Cabs - Melbourne | 18 November, 2016, 09:03

If the UK has seen a doubling of cash use since the last ten years, they may consider ditching the largest denomination as a security precaution against criminal activity. The use of the largest paper note denomination in things such as the illegal trade in drugs, money laundering, capital flows outside of any nation-state and a useful method of stymieing the financing of terrorist activity. 

 

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Russell Bell
Russell Bell - Fastbase Ltd - Wellington | 20 November, 2016, 00:09

If the UK ditched large-denomination bills they'd have to quickly reintroduce new bills of similar denomination like India is doing now.  There'd be negligible long-term effect on use of cash for illegal transactions.  Indians are cynical about the short-term motives; the effect on upcoming state elections is likely to be difficulties for smaller political parties (obliged to store their illegal contributions in the form of cash) while bigger political parties keep their dirty money in bank accounts.  The Indian banks were in desperate need of a liquidity injection and will be breathing a big sigh of relief for the sudden rush of deposits.  The public mood is ugly in part because the move disproportionately hurts rural people with poor access to banks or ATMs.  I doubt citizens in Western countries would view such a move any more favorably.

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