2014 was the first year with more payments made via cards, electronic transfers or by mobile phones than with cash notes and coins.
This should be the start of a trend that will see a steady decline in cash payments over the next ten years, predicts the Payments Council (the trade body for processing payments in the UK).
Cash “still king” with consumers
The Payments Council highlight that despite a steady decline in the total volume of cash transactions, cash remains the most popular way for consumers to pay for goods and services, when you take businesses payments out of the numbers.
Just over half of all consumer transactions are made with cash, though this number is shrinking as more and more of us turn to credit and debit cards for our everyday purchases.
The Payments Council forecast this figure will drop below 50% next year (2016), but there is no prediction for cash to disappear.
They also highlighted that the number of cash machines and people using them is still growing year-on-year: the number of ATMs reached a new peak with 69,382 across the nation and 91% of us withdraw cash from an ATM at least once a month.
How will we pay for our purchases in the future?
Plastic cards seem to be here to stay, despite challenges from mobile phone payments and banking apps, such as the much awaited ApplePay app.
Contactless cards, which let you make purchases under £20 by simply tapping your card without entering your pin number, are becoming ever more widely accepted and most new credit and debit cards have this feature as standard.
David Mann, Head of Money at uSwitch says:
“However, plastic cards might someday soon go the way of cash as mobile payments take over. But either way, with apps like ApplePay you will still need to apply for a credit card or bank account and register it with the app, the app is not a replacement for the credit card.”
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