Posted on: 09 February 2021
COVID-19 has caused a decline in cash payments in the UK
Consumer choice service, Which?, found that not only has cash usage in the UK declined because of COVID-19, but 34% of people in a recently conducted survey stated they were unable to use cash during a transaction.
In 2017, for the first time ever, cashless payments overtook cash payments in the UK, a trend that has continued every year since and is predicted to continue at an even faster pace as a result of the COVID-19 pandemic.
How has cash usage declined?
Since 2008, cash usage in the UK has been on a steady decline, with cashless payments, such as cards and contactless forms of payment, on the increase.
In 2017, cashless payments finally overtook cash payments in the UK, which has continued as a trend ever since. UK Finance has also predicted that this trend will continue all the way through to 2028.
Easier access to bank cards, online shopping and payment technology, such as PayPal, Apple Pay and Google Pay, have all made spending money contactless more convenient than using cash.
How COVID-19 affected cash usage
Fears of COVID-19 transmission
Cash usage was already on the decline, but there were fears that COVID-19 was able to survive on notes and coins, leading to fewer people or businesses wanting to accept cash. As we previously mentioned, 34% of people in the UK had stated that they had not been allowed to use cash during a transaction due to COVID-19.
Some businesses have now started to accept cash as a form of payment, but early on in the pandemic, many businesses would only accept card or contactless as a form of payment to reduce the risk of transmission when handling cash.
Online shopping was already a huge part of the retail industry, with fewer people visiting the high street retailers, however, COVID-19 was another push in the direction of online shopping.
The Retail Gazette found that 17.2 million people in the UK would continue to shop online, even after the pandemic had ended. This is likely due to the convenience, and usually the lower costs. Of course, online shopping relies on cashless payment methods, so this will contribute to the trend of more cashless payments.
Can you take your business cashless?
We have previously produced written content about how you can take your business cashless, the reasons why you could choose to do so and the pros and cons of taking your business cashless. Take a quick look at some of these pros and cons:
Pros of a cashless business
- Convenience for customers
- Removing cash from your site
- No cash handling
Cons of a cashless business
- No backup for power outages or banking issues
- Tourists, vulnerable members of the public or the elderly may rely on cash
- Pushback from traditionalists
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