With only 18% of transactions in the UK being paid for in cash, is the bank note becoming a thing of the past?
When was the last time you took cash out of the cash machine? How long does it last? What do you spend it on? In today’s society, especially with new technologies such as contactless cards for those smaller item purchases, more and more people just don’t use cash like they used to. It’s quick and convenient to use a card to pay for your purchases rather than having to visit the cash machine first.
But where do you actually still need to use cash? Buses and taxis maybe? Not necessarily, even they have upgraded their systems to give the option to pay by contactless card, or even oyster card. Some people like to purchase currency with cash as you generally get a better rate and no bank fees. A pint at the pub? Most pubs and bars have card terminals, but they also generally have cash machines if needed, all be it, chargeable machines.
So would you pay to get your own cash out rather than using your card to pay directly? If, in the future, all machines charged to take out your hard earned cash, would you stop using cash all together?
There’s no question, handing out physical cash ‘feels’ like you are spending and you have to make the decision to part with it from your pocket or purse. And using a card can seem flippantly easy and is simply a ‘plastic card’ you use to get things you want.
And what about credit cards? Of course, a lot of people use credit cards now for more than just a way of delaying payment. With protection against non-receipt of goods or dealings with unscrupulous companies and being able to collect ‘points’ or vouchers or even cashback to use on further spending, more and more people use on credit cards for these opportunistic reasons.
Another plus of using a card rather than cash is to aid in budgeting or tracking your spending. If you take £50 cash out from an ATM machine, do you really know where it all goes? Or do you open your wallet or purse to that disappointing feeling when you realise it’s all gone! Spending on your card can help you track what you spend and also help you to identify exactly what you are spending on and maybe looking at what you can cut back on if you needed to. If you don’t know what you’re spending, how can you know if you’re spending too much on the wrong things?
So is cash going the way of the cheque? Although cheque usage has declined in recent years as businesses have started to use automated payments and cards, it still remains a very important payment method, particularly for small businesses. This is why they are still around. And cash is no different for those small companies who can’t afford the demanding costs of card machines. These businesses rely on cash and cheques to sustain their income and in a lot of case, their livelihoods.
So whether you love it or hate it, rather than turning into a cashless society, it seems like cash will be around for the foreseeable future 🙂
Source: BBC Radio 5 Live Wake Up To Money podcast