Cash payments in the UK rise for first time in 10 years

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Payments made with cash rose for the first time in a decade last year as consumers struggled with rising prices.

But the number is still dwarfed by debit card use which accounted for half of all payments, its highest ever level.

Consumers often say they find it easier to manage their money using cash.

However UK Finance, which compiled the data, said it expected cash use to decline over the coming years, once the current financial squeeze has eased.

Even during cost of living pressures and the emergence from lockdowns, it said nearly 22 million people only used cash only once a month or not at all last year. That compares with just under one million who mainly used cash.

People are still most likely to pay for things using a debit card. Part of the reason for that is that people use them to make contactless payments for low-value buys in shops, whereas in the past they might have used coins. The typical amount spent for each contactless card payment was £15.10.

Debit card use rose last year to account for half of the 46 billion payments made by consumers and businesses last year, according to the UK Finance data.

Among consumers, debit cards were used in 57% of transactions.

Some of the rise was driven by people working part of the week at home, and only commuting on the other days. People are travelling to the office less but making more transport payments.

There was a slump in the purchase of annual or monthly season tickets, with consumers instead using their debit card more frequently to pay for individual journeys. Cards loaded onto smartphones and watches are included in the total.

The research also pointed to anecdotal evidence that suggested people were making more visits to supermarkets but spending small amounts each time, rather than doing one large weekly shop..

Read more via BBC

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