Will the UK become a cashless society?

In 2023, only 12% of payments were made using cash. Instead, most people now use faster options like debit and credit cards. Over half of UK residents have struggled to pay with cash in 2024, due to businesses only accepting card. This raises the question, will the UK become a cashless society? In this blog, we will discuss why the use of cash has decreased and how this impacts small businesses.

Since the Covid-19 pandemic in 2020, cash use has declined rapidly. One of the reasons for this is because the UK government advised against using cash. During the height of the pandemic, cash was seen to be a breading ground for bacterial and increased the spread of the virus. Businesses switched to card-only payments, focusing on contactless and digital wallet transactions. Even after the pandemic, some businesses decided to stay cashless. This includes big restaurant chains like Prezzo, Itsu, and Pizza Hut. They claim this makes transactions simpler and faster while also reducing the risk of theft and fraud.

Cash usage has fallen by about 15% each year since 2017. It is now less profitable for banks to maintain a large amount of ATMs. Over 340 ATMs are removed each month on UK high streets, making it harder for us to withdraw cash when needed. In London alone, this has led to £500 million less being taken from ATMs each month.

In 2022, for the first time, more than half of UK payments (57%) were made using debit cards, while contactless transactions grew by 30%. The success of contactless payments is due to their speed, ease and convenience. These PIN-free transactions make payments quicker, with an average transaction taking just 15 seconds. This benefits both businesses and customers by reducing queuing times. Contactless payments are up to ten times faster than cash and also add extra security to transactions.

Are We Going Cashless?

More than 10 million people in the UK would struggle if cash disappeared. According to the Royal Society of Arts, many people on lower or unstable incomes prefer cash as it helps with budgeting. Seeing and handling physical cash makes it easier to avoid overspending.

Older and vulnerable people are also more likely to depend on cash. If the UK became fully cashless, 8 million people could struggle with everyday payments.

Cash is also an important backup if card and digital payments fail. A cashless society could cause major issues during system failures or power outages.

A Cashless Society?

FinTech Weekly predicts that by 2024, the UK could become completely cashless, but this would require the government to phase out physical money.

By 2043, paper money may be almost obsolete. However, the government is unlikely to stop printing notes and coins, as millions still rely on cash for everyday transactions. Instead, cash use will likely continue to decline, much like cheques.

In 2023, 129 million cheques were used in the UK, a 14% drop from the previous year. Despite this, the government has no plans to stop issuing them. The same applies to cash—while its use is falling, there are no laws forcing businesses to accept or reject it.

The Future of Payments with UTP

As cash use continues to decline, small businesses need fast, secure, and cost-effective ways to accept payments. At UTP Group, we provide a range of card machines, including countertop, portable, and mobile options, designed to make transactions quick and hassle-free. All our card machines accept chip and PIN, contactless and mobile payments. With Faster Processing, your businesses receives your funds on the same day. This removes the funding delay that most businesses face, keeping your cash flow steady. On average, we save customers 33% on transaction fees, making us a cost-effective choice your business.

If you are looking at taking card payments or changing provider, contact us on 0330 99 99 300.