The end of the wallet is near, according to MasterCard. New figures seem to show that Brits carry less cash around than ever before. But dramatic predictions about the death of cash are nothing new, and neither are their dismissals.
Last year, as well, a Telegraph article told us that many Brits think cash will disappear by 2025.
BBC Future did an excellent in-depth piece on “The truth about the death of cash” not long ago, dispelling most of the common myths of cash’s decline. At the investigation’s core was the finding that “There is simply no alternative system of payment that is as convenient, reliable and anonymous.”
That doesn’t mean, however, that card and mobile payments are not becoming an integral part of our everyday lives. Of course they are. But all the different payment methods actually go quite well together – and contactless and mobile payments can just as easily replace each other, and traditional debit cards, as they could replace cash.
The UK actually has a projected overall cash growth of 3.9% between 2015 and 2020, according to the PYMNTS.com Global Cash Index. Even MasterCard’s findings agree that almost nine out of ten people (86%) rely on cash in their daily lives.
The total number of cash payments last year was also staggering: 17.2 billion purchases. That’s quite a lot of meals, cab fares, trips to the pub, and Sundays at the shopping centre. And for all that shopping, Brits used cash machines to withdraw money 2.8 billion times, for a total amount of an incredible £194 billion.
The £194 billion cash withdrawal figure is even up 2.6% from 2014’s cash machine use, which means that every day in 2015, the average UK ATM gave out about £100 more than the year before.
Looking beyond the simple figures from MasterCard, then, this detailed data doesn’t look at all like the death throes of cash. Instead, it shows how an ever-changing payments landscape is continuing to adapt to new circumstances and innovations.
Indeed, the main challenge to this new payments landscape isn’t imaginary squabbles between different payment methods. It is making sure everyone has access to the payment methods they prefer. And with 9,500 bank branch closures up and down the country since 1990, that is a very real issue: over the last decades, more than 1,500 local communities in Britain have lost their bank branches, and with that a part of their local access to cash.
Access to cash is absolutely vital for local business success and a thriving high street. Independent research published by Cardtronics found that on average £16.30 from each cash machine withdrawal goes straight back into local shops by the cash point.
A mutually beneficial solution for consumers and businesses alike, then, may be for banks and high street retailers to partner with independent ATM operators to ensure access to cash in all local communities. Cardtronics has already partnered this way with banks and installed new cash machines in towns and villages from Glastonbury in Somerset to Howden in Yorkshire.
And if you’re still not convinced that cash is here to stay for the foreseeable future, just look at the new polymer banknotes issued by the Bank of England. The government clearly doesn’t think that cash is going to disappear: a new £5 note just came out, a new £10 note comes in 2017, and a new £20 note will be out by 2020. The BoE is planning for the future – a future with cash.
So the next time you hear the same old story about the so-called ‘death of cash’, remember that, once again, the data shows that cash and cash machines are the lifeblood of our local economies and high streets up and down the country.
By Tom Pierce, global CMO at Cardtronics