The United Kingdom has taken significant steps towards becoming a cashless society. A survey conducted by money.co.uk, a finance website, ranked the United Kingdom fourth in cashless countries across Europe. More than nine in 10 British citizens over the age of 15 have a debit card and 65% have a credit card.^[1] Furthermore, a survey from Mastercard shows that in UK, people do not have cash on them, as most businesses offer the ability to pay by card. Credit and debit cards are the two most popular payment options, with PayPal coming third. Moreover, 27 percent of customers have stated that did not purchase because they could not pay by card but only in cash. There were 1.8 billion debit and credit card transactions in the UK in June, 42.4% more than in June 2020, and 15.8% more than June 2019.^[2] Especially during the Covid-19 period, in 2020, cash transactions decreased by 35%.^[3] Consumers have begun to use debit and credit cards, as well as digital wallets, to make their purchases in the country. For this reason, most businesses now have this method of payment while some do not even accept cash at all. For contactless transactions, the limit for tap and pay was increased from £30 to £45 in April 2020 and now reaches £100

In fact, a recent funded study showed that cash payments will account for only 10% of total transactions in the next 15 years. The same study argues that a new, more efficient cash infrastructure is needed to keep cash in circulation for as long as society deems necessary. This is helped by the fact that low-income people living in rural areas, or the elderly still use cash and that there needs to be a plan for them too. These people are about 8,000,000.

But the use of digital wallets has also gained popularity recently. Digital wallets are even slated to compete with cards in the payment methods market in the future. The most common options are currently PayPal and Google Pay. Currently, the UK is the only European country where Address Verification Service (AVS) is supported. And there is strong publisher support for 3D Secure. UK Finance, the payments and finance industry union in the UK, said the country will raise its fee-free limit from £15 ($17.43) to £45 ($52.29). UK shoppers made 9.6 billion contactless payments in 2020, up 12% on the previous year. (2021). Finally, charities have also started to explore card readers for ‘click and donate’ to increase giving.

As for businesses, the commission they charge for depositing money is often more expensive than the card transaction fee. This is necessary for businesses to remain competitive. Even in the UK, where people used to pay cash, they now pay by card. Businesses need to establish a strategic business plan that includes cashless payment methods. There are several options for accepting cashless payment methods, such as iZettle and Worldpay^[4] This strategy should include the integration of epos (Integrated and unintegrated), the online store and reviews, digital wallets and evaluate them based on the customer experience and the total transaction time.^[5]

Some of the digital wallets that are particularly popular are: Google Pay, Apple Pay, PayPal, Flint, PaySimple, Stripe, Square and Venmo.

• Regarding the need of cashless payments, you can watch the follow video;

https://youtube.com/watch?v=8uv_RUljRJg%3Ffeature%3Doembed

• You can read more regarding a cashless society here; https://www.askattest.com/blog/research/british-consumers-are-ready-to-embrace-a-cashless-future

References

de Best, R. (2021, December 15). Mobile payments in the United Kingdom (UK) – statistics & facts. Statista https://www.statista.com/topics/6757/mobile-payments-in-the-uk/#dossierKeyfigures

Walsh, S. (2020, June 25). A Guide to Using Cashless Payments in Your Business. Square. https://squareup.com/gb/en/townsquare/cashless-payments-guide

Gibson, J. (2021, June 14). How Revolut Business Is Making Life Easier for Start-Ups And SMBs. Forbes. https://www.forbes.com/sites/revolut-business/2021/06/14/how-revolut-business-is-making-life-easier-for-start-ups-and-smbs/?sh=69b99d5d43a5

Worldline. (2021, March 1). Prepare Your Small Business for Cashless Payments. https://www.bambora.com/articles/prepare-your-small-business/

European Parliament (2020) The rise of e-commerce and the cashless society https://www.europarl.europa.eu/RegData/etudes/BRIE/2020/649341/EPRS_BRI(2020)649341_EN.pdf

Revolut’s website: https://www.revolut.com

Business Pricing. (n.d.). Revolut Business https://www.revolut.com/business/business-account-plans

[1] https://squareup.com/gb/en/townsquare/cashless-payments-guide

[2] https://www.nationalworld.com/lifestyle/money/cashless-society-should-the-uk-replace-cash-with-digital-transactions-for-good-3418463

[3] https://www.theguardian.com/business/2021/jun/16/cashless-society-draws-closer-with-only-one-in-six-payments-now-in-cash

[4] https://www.wellersaccountants.co.uk/blog/now-is-the-time-to-prepare-your-business-for-cashless-payment

[5] https://www.opayo.co.uk/blog/cashless-payment-systems