It’s not a binary argument about ‘cash’ versus ‘cashless’

It is being widely reported that the Chancellor, Rishi Sunak, will unveil new laws in next week’s Budget to protect the right to use cash. The move is intended to ensure that people who rely on cash such as vulnerable groups and local communities around the UK can access cash as and when they need it.

Although I’m a cashless advocate (follow my blog at www.cashlessuk.org) I am also an advocate of true consumer choice on how we pay for things.

Burkhard Balz at the German Bundesbank was spot on when he said:

“Consumers should be able to decide for themselves how they pay. For us, it is important to have a broad mix of options and that efficient methods for payment are available”

Burkhard Balz, Bundesbank, Germany.

It is not a binary argument

However, the cashless challenge we face is not a binary argument about ‘cash’ versus ‘cashless’ where one side will emerge a victor. The challenge is, as Balz states, to ensure the UK has a broad mix of efficient options for the consumer to decide how they pay for something (and, I will add, that are equitable, inclusive and accessible to all).

The use of cash is clearly in terminal decline as LINK, the operator of the UK’s ATM network, own figures report.

Month on month figures from LINK demonstrate that the UK is fast becoming a truly cashless society. For example the number of cash withdrawals for last week are down roughly 10 million on the equivalent week in 2019.

Link’s graph of weekly ATM transactions for 2017 to 2020 show that neither last week, last month or last year were a ‘blip’. The reduction in the reliance on cash by UK citizens is a more than a trend it is a reality.

Don’t preserve cash for cash sake

As the issue of maintaining cash supply in a market where the use of cash is fast disappearing is addressed, the UK must guard against preserving cash for cash sake. It is vital that government, regulators, banks and companies seek to ensure that digital payment options are available to all in society – options that are equitable, inclusive and accessible to all.

Digital payments do, can and should work for everyone

Nat Ceeney, the author of the Access To Cash review, states that ‘digital payments don’t work for everyone’.

I’d argue that digital payments already do work for a lot of people, can work for most people and it is incumbent upon government, regulators, banks and companies to make sure digital payments work for everyone.

Without this those who continue to rely on cash will be left behind.

Guard against a perverse outcome

A perverse outcome of introducing a law to protect the supply of physical cash would be that those who rely on physical cash are left behind in denying access to efficient ways to pay, accessing paying goods or services and not being able to benefit from the technological revolution we are enjoying in the UK.

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