Are we moving towards a cashless society?
Published 6 July 2012 by Daniel Culpan
When companies favour payments by card rather than cash, could we be moving towards a cashless society?
As the Guardian reports, 13:03:57 on Friday 28th October last year marked a historic moment for the banknote. This was the single busiest second in the Link network's quarter-century history - with 482 cash machine withdrawals made simultaneously across the nation.
It seems that the tough economic climate has boosted the popularity of cash, as people living on squeezed budgets look for more control over their money. Last year, according to figures from the Payments Council, an additional £5.5 billion was taken out from cash machines. This was the first increase in cash withdrawals since 2008.
Yet, as our appetite for cash grows, it appears more and more businesses and services are turning their back on the banknote - and opting for payments on plastic instead. Utility companies, for example, tend to prefer customers to pay their bills by Direct Debit - and energy customers who pay by cheque or cash could end up facing charges of up to £100 a year more.
Already, more than 12 American airlines have declared their cabins cash-free zones, and it could only be a matter of time before UK flights - where you can currently still pay using hard cash - adopt a similar cards-only policy.
Interestingly, companies are well within their rights to charge their customers extra for paying by cash, as long as the fees are made clear and alternative suppliers are available.
A spokesperson for thinkmoney commented: "With many people living on tight budgets, paying by cash - and seeing exactly how much is spent - can give banking customers more control over their money.
"You could also think about other ways of giving your budgeting skills a bit more help. The basic bank account, for example, comes with a Money Manager service, which means your money is divided into two separate accounts every month: one for your bills, and one for your 'spending money'. As a result, you shouldn't ever accidentally spend the money you need for essentials."