Will UK go cashless despite people’s choice?

With the Brexit, the UK have reclaimed a certain sense of sovereignty. But tomorrow’s debate isn’t so much about the Union, it’s about cash. Will the UK become a cashless territory? The United Kingdom seem to have engaged in a transition towards that goal, but are the citizens willing to take the step?

British pounds

Today cash continues to be the champion of the payment methods in the UK. According to the U.K analysis of the PYMNTS.com Global Cash Index, cash still represents about 48 percent of the transactions made (it is more than credit cards and more that online wallet payments but it is less than both of them combined).

Analysts are even foreseeing that the use of cash will keep increasing in the next four year (of about 0.61% per year). These figures are going right against all the prophecies about the death of cash and the cashless future of the United Kingdom.

Meanwhile contactless transactions are also growing and we are seeing an increasing number of contactless POS terminals in the marketplace. “While a decline in cash share might hint toward the demise of cash, the reality is far from it” according to Bank of England’s Chief Cashier Victoria Cleland. People have been predicting the end of cash pretty much since I was born… every 10 years or so they forecast it and they are wrong,” (1) she said.

For many individuals with a poor credit history, for example, cash has historically been the only option as they were sidelined by the traditional banking system. Without banking services it is harder to find a stable financial footing and almost impossible to collect enough for long term investments like education and property.

But the poorest classes of society wouldn’t be the only ones disadvantaged by the disappearance of cash. If younger shoppers have ingrained electronic payments, it isn’t the case for the elderly population for whom cash remains the only trusted payment method.

In the capital, the cashless economy seem to be already on its way. Transport for London no longer accepts any form of cash payment on its buses. For many, the acceptance of a ‘cashless United Kingdom’ comes from the fact that electronic and online payments would be more secured than the usage of cash. It would seem perfectly accurate if we didn’t look at the data. But in the past years, online frauds and cyber criminality have greatly replaced physical robberies involving cash.

in 2015, in England and Wales alone, over 3.8 Million adults were victims of some form of online fraud according to the Crime Survey for England and Wales. In addition, the data showed an estimated 2.5 million incidents categorized under the Computer Misuse Act, where the victim’s computer or other internet-enabled device was infected by a virus or where a victim’s email or social media account had been hacked. All of them with the ultimate goal to rob un-physical money to their victims.

“Today’s crime figures for the first time show that fraud and cybercrime are the most prevalent crimes committed against victims in England and Wales” said Adrian Leppard, commissioner of the City of London Police. “Fraud and cybercrime affect every community in the country and do not discriminate by social status or geographical location”. (2)

If the UK was never in the Euro zone, going back to a certain form of protectionism through the Brexit also means something about the economy and about cash money. Cash money guarantees the freedom for its users to be independent from their financial institutions. In a cashless society, banks are the only option but being more independent from them also seem to be the message from the Brexit vote.

A cashless society doesn’t happen overnight, by passing anti-cash laws, a government can rapidly move towards that direction; by increasing the number of stores allowed to refuse cash, by making hoarding more and more complicated…

Today, the national bank of England seems to be in a complex situation. Next year, new banknotes will be introduced in England. These banknotes are using the polymer paper technology which will make them some of the safest banknotes on the planet as they seem as hard to counterfeit as her Majesty the Queen herself.

The polymer notes are a major investment that is ahead of its generation and those notes should be able to last for over a decade without getting old. Yet the cashless debate is still on the table but more and more UK citizens are starting to seize it as a new battle to fight after the Brexit.

For them, cash means keeping their autonomy from the banks and also from the Government. “There isn’t much privacy in a cashless society and Big Brother isn’t too far” says Amy, a mid-age activist from northern England who had seen ATMs disappear in her area without a public consultation and who created a local group online (2). “My parents are older, they don’t even know that other payment methods exist” she said, “and here, we are far away from the big cities, most of our economy relies on cash. It will be a direct attack on the poor if they decide to go cashless”.

More and more citizen voices like Amy’s are being heard every day thought the UK and, since the Brexit, we know how far the voices of the people can resonate…

(1) Victoria Cleland, Future of Cash Conference; U.K analysis 2016

(2) Europe says goodbye to €500 bill, Pymnts, May 5th 2016

(3) Amy Page, Founder of the Facebook group page ‘no to a cashless UK’

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