Cash is still the most popular way to pay - but for how long?
Published 30 May 2013 by Joel Stanier
New figures show that cash is still the most popular way to pay. But with other payment methods growing in popularity, how long before more of us are paying with smartphones or online?
There has been lots of talk of cash dying out over the next few years, but it's still the most popular way to pay, according to the British Retail Consortium (BRC).
Cash still accounts for around 54% of all transactions in the UK, suggesting that many people still appreciate the freedom and security it brings compared with card payments.
Debit cards also remain popular, accounting for 30% of transactions, while credit and charge cards account for almost 11%.
But while debit card transactions grew by 3.2% in the last year, spending with cash actually fell by 6.7%.
And alternative methods of payment are growing. Online payments (e.g. PayPal) now account for 5% of total transactions, while money-off coupons have also become more popular.
Helen Dickinson, Director General of the British Retail Consortium, said: "New ways to pay and new ways to shop are shaping the retail landscape like never before. Changing customer preferences are driving the increase in debit card use - they're helping people to manage their money better and are a natural fit for online shopping and self-service checkouts.
"Cash is still the most popular way to pay, but our survey shows how rapidly alternative and emerging methods are gaining ground [...]. These methods will be the ‘ones to watch' in the future."
How will we pay for things in the future?
Debit cards are arguably the most useful method of payment - making easy work of big purchases like your weekly shop, clothes or a new laptop.
But many people still prefer cash, especially when it comes to smaller purchases like a quick coffee or a newspaper.
And it's recently become even easier for some account holders to get their cash - with some banks letting customers withdraw cash via a six-digit code, sent to them via smartphone app.
Many experts believe we'll live in a 'cashless' society before too long - with all payments made by card or mobile phone. But with cash still representing more than half of purchases in the UK, it could be a while yet before people are ready to do away with cash altogether.