ATM network head warns cash may be nearing completion by the end of summer as customers switch to using cards and never go back
Cash could be nearly dead by the end of the summer, as customers switch to using cards and never go back, the head of the ATM network warned last night.
John Howells, CEO of Link, who manages Britain’s 70,000 cash points, said the corona virus pandemic has accelerated the move from cash to card and online payments.
Before closing, around a third of transactions still used cash. Link now predicts that its use will drop to just 10 percent by August, as people shop and go out less, use cards when stocking up in supermarkets, and avoid coins and banknotes for fear of picking up the virus.
End of an era ?: Before the close, cash was still used in about a third of transactions
Research shows that once people switch to using cards and digital payments, they rarely use more cash. Cash was previously expected to drop to 10 percent by 2025, meaning a five-year change is now expected to last five months.
Howells said the rapid decline could close large numbers of ATMs as they are used less frequently, while withdrawal fees could be quickly entered into other ATMs to ensure they remain profitable.
Older and more vulnerable people would be most affected, as they may have to travel miles to withdraw money.
But Howells warned that the rapid decline would hit tourism, as those visiting Britain would not be able to withdraw cash, as would self-employed people who accept cash only, plus 1.4 million people who don’t have a bank account. Link’s prediction comes after last week’s figures showed that the number of ATM transactions fell by 50 percent in March compared to last year.
“The use of cash will not come back and resume its slow decline,” he said. The tap-and-go contactless spending limit increased from £ 30 to £ 45 last week.
Natalie Ceeney, the former chief financial ombudsman who conducted a major study of how people access cash, said, “Many people will get used to using digital and they will find it quite easy and get into the habit of using it. use. ‘Just think of my parents who never shop online. They are doing it for the first time in their lives. ‘
Howells warned that Britain is not ready to lose its access to ATMs and banknotes.
An analysis of Ceeney’s Access to Cash review found that a fifth of the British couldn’t do without money. Experts also warned that new digital systems are vulnerable to cyber attacks.
“We’re just not ready to switch to digital systems because they are going wrong,” Howells said.
Ceeney: ‘We were already worried about leaving parts of the population behind and the virus has accelerated that. What we shouldn’t do is sleepwalking to get cashless. ‘
DO NOT MAKE CRISIS AN EXCUSE
“I think your Keep Our Cash campaign probably bit the dust.” That was a reader’s reaction last week after banks agreed to raise the limit for contactless transactions from £ 30 to £ 45 – and cash plummeted in response to the corona virus outbreak.
An understandable comment? Of course. But I disagree. Banks simply should not use the corona virus as an excuse to deprive us of our right of access to cash – whether through free-to-use ATMs, cashback facilities at supermarkets or through major banks and construction associations.
While most of us are comfortable waving our plastic for card readers, not everyone is.
For example, my mom remains married with checks and cash, while my partner’s mom refuses to use plastic.
She occasionally goes to her bank and raises enough money to keep her going for a while. They should not be given up.
When we emerge from this pandemic, it is essential that a nationwide cash network remains.
Cash may no longer be the king, but it is an essential gear in our economy.