Cashless payments overtake notes and coins
21/05/2015
Payments made using cards, cheques and transfers have overtaken the use of notes or coins for the first time ever, according to The Payments Council.
Cashless payments have surged to 52% as the use of cash by consumers, business and financial organisations fell to 48%. Cash volumes are expected to fall by a further 30% over the next 10 years as moves towards debit cards, contactless and mobile payments drive the move away from cash.
Despite the falling levels, cash remained the most popular method of payment among shoppers and businesses in 2014. A total of 18 billion cash payments were made in 2014, totalling about £250 billion. This was followed by debit card, which totalled 24% of payments and direct debits which totalled 10%.
The Payments Council has predicted that among consumers the majority of transactions will be cashless by 2016. This is because younger consumers are less reliant on cash, and advances in technology.
Bank of England (BoE) chief cashier Victoria Cleland, believes cash still has a long future. The BoE will be bringing in a new £1 coin in 2017 and new types of £10 and £5 notes will entered into circulation in 2016. Cleland said:
"Since I started the job I am seeing a growing demand. I am seeing a 46% increase of notes in circulation. I think the proportion of cash transactions is coming down, but I'm still seeing a fairly stable value of cash transactions."
Need financial advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245, or by arranging a visit.
Share this..
Related stories
Is the credit card market turning?
Even though there are very few 0% balance transfer credit card deals available at the moment, with even fewer offering no fees, the move by Virgin Money has somewhat shaken up the market in the UK. The opportunity to transfer your existing credit card balance to a Virgin Money Credit Card and escape any interest charges for nine months, with no setup fees, is sure to attract the attention of many...
Read MoreTK Maxx scam should not scare shoppers say experts
Fraud protection specialist firm the 3rd Man has said that while the recent credit card scam surrounding TK Maxx gives shoppers further impetus to keep tabs on their bank accounts, it should not be a reason for widespread panic in the UK.Paul Simms, CEO of the 3rd Man, said: "If it's true that 45 million customers have had their cards compromised, that’s obviously very serious but...
Read MoreMBNA set to end credit card cheques
In a move which has apparently been on the cards for some time, MBNA is set to phase out credit card cheques ahead of a government ban when the Financial Services Bill comes into force next year. While credit card cheques have proved useful to some customers, many promotional credit card cheques have tempted new customers to spend money which perhaps was beyond their means. Not only do these cr...
Read MorePPI strongly criticised by Which?
Payment Protection Insurance (PPI) for credit cards does not offer good value for money, Which? said today.The consumer group pointed out that over one in ten of the cover's customers thought that it was either compulsory to purchase, or would improve their chances of getting future credit applications accepted.Both of these suppositions are wrong.PPI cover works by offering to help with credit re...
Read MoreTwo million offered credit card insurance compensation
27/01/2015 Two million customers will be offered compensation from their banks for being sold insurance policies they didn’t need, covering the loss or theft of their bank cards. Banks and credit card issuers have been told by the Financial Conduct Authority (FCA) that they must send a letter to customers who were affected, asking them if they would like compensation. These letters will b...
Read More