• Marc Terry, International Managing Director at Cardtronics


• 19.08.2021 03:30 pm
#Payments #cash

74% of UK consumers believe that all retailers ought to be offering them the option to pay in cash

Cash withdrawals in the UK are up compared to this time last year, and with it, consumer support for cash is increasing with a recent survey showing that almost three-quarters (74%) of UK consumers think that retailers should offer the option to pay by cash. This data is an important consideration ahead of the government’s Access to Cash consultation. First and foremost, it raises the question: does the current cash ecosystem meet the needs of consumers, or have the banks pushed the UK towards a cashless society too far, too fast?

Are we being forced to go cashless?

The pandemic has been seen by some as the perfect opportunity to strike a deadly blow against cash. Fundamentally, many of our high street banks have now realised the savings they can, and do, make by not having to provide this valued service to their customers. But consumers are clearly not buying it; 7 in 10 people believe that the banks are trying to push us towards a cashless society against our will. This push becomes particularly transparent when we consider how the anti-cash lobby used the pandemic as an opportunity to promote alternative forms of payment, despite WHO and the Bank of England confirming cash was low risk for covid transmission. 

To make matters worse, the solutions positioned to make cash more accessible are flawed. The introduction of cashback without purchase for example. Cashback essentially places the responsibility of providing limitless cash onto retailers. Insufficient thought has been given to who should pay the retailers for offering this service or how much they should be paid. Cashback adds unnecessary risk to retailers as they will need to hold extra cash to deliver the service effectively, and it will inevitably result in longer checkout queues bolstered by people not actually buying anything. From a customer perspective, it’s not wanted - only 2% of consumers currently use cashback. Recent research has also found that 96% of people have withdrawn cash from an ATM in the last year, compared to just 45% who have withdrawn from a Post Office. There is a clear consumer preference for the ATM network as the way to access cash because of its speed, anonymity, and 24x7 availability. Despite this, the government still seems to believe that cashback is the answer to the access to cash problem. Not surprisingly, the banks are very supportive of this solution as it removes the need for them to provide access to cash for their customers.

UK banks are retreating from the high street. Branch closures continue to be reported in the news seemingly every week. In almost all circumstances, a branch closure results in the loss of another ATM, and so access to cash for residents becomes increasingly difficult. The knock-on impact of this to communities is stark. It has a disproportionate impact on the elderly and vulnerable who are less likely to be able to travel to the next nearest cash access point, and to the small businesses who often rely on cash to survive.

What is the government doing?

With all of this considered, the government has taken some positive initiatives, such as the ‘Reopening High Streets Safely Fund’. This action prioritises protecting small businesses, including those where cash is essential. Many small businesses have in-store ATMs that are essential to their existence. Research has found that consumers who use an in-store ATM withdraw an average of £60.54, with 35% (£21.19) of that cash then spent immediately in-store. It is important that the government doesn’t turn a blind eye to these important facts and preferences in consumer behaviour, otherwise the high street will not reopen effectively in the way that many of us hope.

With the consultation still ongoing, and the opportunity to step back from irrevocable damage to our cash ecosystem, we urge the government to take immediate action. The necessary legislation must be implemented to ensure that the option is always there to pay by cash over the counter. It is high time to address and reset the cash supply / demand balance based on data and consumer wishes. If LINK were to rescind the cuts, they have made to the interchange fees that underpin what was the world’s most accessible cash infrastructure, then ATMs could be reassessed with a view to returning many machines to a free-to-use service. Cash provides us with a choice: freedom from technology and greater security, which must be protected.