Posted on June 2, 2014 by staff

Fewer Cash Transactions Taking Place Than Ever Before

Fewer Cash Transactions Taking Place Than Ever Before

A steep rise in the number of online sales and contactless card payments has led to fewer people using cash to make purchases than ever before.

According to a survey by the British Retail Consortium (BRC) online sales and contactless cards are behind the 14 per cent fall in cash use over the past five years, while debit card use has increased by 11 per cent.

Cash accounted for 53 per cent of the number of transactions in 2013, with debit cards accounting for 32 per cent, the BRC said.

In terms of the value of transactions, however, cards accounted for 50 per cent of transactions.

“Customers are taking advantage of new ways to shop and pay,” said Helen Dickinson, director general of the BRC.

“The availability of contactless cards, handy express stores and self-service tills as well as online sales has increased the use of debit cards for smaller payments in place of cash.

“Cash use down 14 per cent in the last five years is a milestone in the development of our digital economy.”

The BRC said the average costs to a retailer of processing a credit or charge card payment had increased by 18 per cent, to 41 pence, in the past five years.

Debit card payments, on average, cost 8.8p to process, up 4 per cent over the same period.

“It is really disappointing that the average cost of accepting both credit and debit cards have increased over five years, while cash costs have gone down,” said Ms Dickinson.

However the UK Cards Association, which administers card payments, said retailers needed to make a fair contribution to the costs of processing the transactions.