Brits are speeding towards a ‘cashless society’, with people increasingly choosing credit over cash as their preferred method of payment.
A significant 30% of Brits carry less than £10 in their wallet and just 5% carry over £50, according to research by Clydesdale and Yorkshire Banks.
The fact that a tiny 4% withdraw more than half their income in cash also highlights the UK’s move towards a cashless society, in which people become increasingly reliant on direct debit, card payments and online transactions.
“Whether it is due to convenience or a way of keeping track of finances, more people are opting to use payment methods other than cash,” said Steve Reid, retail Director at Clydesdale and Yorkshire Banks.
Almost one in ten people (8%) do not withdraw a single penny of their income in cash, while 30% take less than 10% of their earnings out in cash.
The cashless society also sees people paying for very small purchases on card. Three quarters (75%) of those surveyed said they would be happy using a debit card to pay for items under £5, and around almost two in ten (18%) said they would turn to credit to pay for items costing between £1.01 and £2.
According to Mr Reid, most people would probably not have thought to use cards for low value purchases ten years ago.
The fact that this is now the norm for many Brits emphasises the changing pattern of the UK’s spending habits; that “cash is clearly no longer king”. The popularity of credit is likely to be in part down to the recession.
Brits are increasingly looking to credit to delay payments and to help make their finances stretch to the end of the month. This comes with the news that mobile operator Everything Everywhere, which owns the Orange and T-Mobile networks, has signed a deal with MasterCard to launch a ‘mobile wallet’. Customers would then be able to leave their wallets at home and pay for goods using their mobile phones, moving Britain closer to being ‘beyond cash’.
Likewise, Apple has launched ‘Passbook’, a service which permits users to redeem coupons, film tickets, boarding passes and loyalty cards via their iPhone.