Despite the growth and increased availability of contactless payment cards, cash still reigns as king of tender. This is according to Ross Macmillan, market intelligence consultant from payment collection specialist allpay, who believes that we are still looking at a significant number of years until cash is replaced as the dominant method of payment.

This week’s report from the British Retail Consortium, which looks at retail sales in Britain in 2013, revealed that the growth in contactless, cards, express stores, self-service tills, and online sales, has contributed to an increased use of debit cards accounting for 50 per cent of retail sales. Over the last five years, new payment technologies have grown in use by 11 per cent, while cash saw a 14 per cent decline.

Macmillan says: “The report suggests that the decline in cash use could symbolise the beginning of the end, but I really think we are some way off this becoming a reality.

Ross Macmillan
Ross Macmillan

“Speculation on the future of cash as a method of payment has been rife for a number of years in the payment industry. I don’t believe suggestions that we are entering a period that will ultimately see cash replaced as the number one method of payment because it will take a significant number of years for the global population to change their mindset on something so engrained into everyday modern culture. One day we will look upon cash with the disdain we do for bartering with livestock or grain, but this is – in all likelihood – decades off,” he said.

Macmillan continued: “With 53 per cent of transactions still being carried out by cash, it goes without saying that it still remains a dominant force in our everyday lives – real money allows you to budget and gain control over your finances, and this won’t change overnight; in fact, we have been in this situation before. In 2011, the decision to cease the production and acceptance of cheques as payment was scrapped due to widespread public and political criticism. Any attempts to do the same with cash would only be met with potentially even great animosity and reluctance.


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“There are a large number of people in UK who still do not have bank account with many more being ‘underbanked’ and preferring to budget and pay their bills in cash. We know from the markets we operate in that cash is an effective budgeting tool – particularly for lower socio economic groups – as they can ensure their spending is closely controlled.

“Arguably, we are moving into a period in which cash will sit comfortably alongside new payment channels, such as mobile applications. It will remain king for retailers, as well as across other sectors such public sector corporates like councils and government departments who are still providing cash facilities to their customers that allow them to pay their bills. However, alongside this we will see the emergence of new forms of payment and its imperative we are able to embrace this.

Macmillan concluded: “The growth in card, mobile and contactless payments does represent an exciting milestone for the development of the UK’s digital economy, but it’s critical to understand that this will not be at the expense of cash. Cash still represents a tangible, convenient and controlled payment method for paying for goods and services.”