As debit, credit, and digital payments become more and more popular, cash is going away. Now there are E-wallets and bank transfers that can take care of what you need instantly—and cash is falling to the wayside. There is no real reason to keep using it other than that it’s traditionally the way we have made value tangible. But the digital world isn’t having it, soon cash will be gone forever.
How Brits are Paying
Recent research conducted by the online marketplace OnBuy, 75 percent of people from the UK choose not to pay with cash. It has never been more important for your business to accept card payments, you would only get 25 percent of the business you would just accepting cash. It isn’t just debit and credit that people are using physical notes and coins, paying with a phone is another popular option. It has been predicted that by 2026 global use of cash will drop 21 percent while the use of E-wallets is expected to grow globally at a rate just over 30 percent.
According to the site MoneyPug, which is used to find UK prepaid cards, debit is the country’s favourite method to pay, accounting for 55 percent of in-store payments and 32 percent of all e-commerce transactions. E-commerce continues to grow while the High Street is still in crisis. With 78 percent of people owning a smart phone, it should be no surprise that E-commerce will account for around 67 percent in 2019 and is expected to reach 73 percent by 2021. Almost half of it will be paid with an E-wallet. Digital payment methods are also rapidly evolving, many small businesses need to evolve with the changes. We can use our phones to buy pretty much anything we want.
Leaving Cash Behind
Since electronic payments are evolving and both debit and credit are as easy to use as ever, many people are leaving cash behind. One out of 10 British adults are now choosing to be completely cashless. According to official government data, contactless payments have led to only one in six young people using notes and coins, and at a lesser rate.
Those 25 to 34 years old, the figure of people living without cash rises to 17 percent, or one in six people. This is according to the banking body UK Finance, which defines a cashless existence as when people either make one cash payment a month or none at all. The number of contactless payments in the UK rose an incredible 31 percent in just a year, reaching 7.4 billion in 2017. On the other hand, around seven out of 10 people in the UK now use contactless payments.
The Map of Contactless Payments
While they are very popular in London, the data revealed that contactless payments were least popular in the north-west of England, where 58 percent of people used this type of payment in 2018. This is compared to 70 percent or more in the south-east, the Midlands, and Wales. UK Finance said that the north-west has been slower than other areas to adopt new technology. Since there are higher populations of older people in parts of the region.
Payments in cash continued to decline in 2018, falling by 16 percent to 11 billion. This means that notes and coins were only used for 28 percent of all payments, which was down from 60 percent only ten years before. UK Finance has predicted that the figure will fall to 9 percent in 2028.
The End of Cash
While according to UK Finance, cash remains the second most frequently used payment method in the United Kingdom, this won’t last for long. It was the number one method until debit replaced it in 2017. The banking body has forecasted that credit and charge cards will overtake notes and coins around the year 2027.
The trajectory is clear, we won’t be using cash forever. It won’t even be very long before it is replaced by E-wallets, credit, and other forms of electronic payment. With more and more people switching to a cashless life, it will be curious to see when cash actually goes away. It feels like it’s going now, but these things always take time.
