Consumers go 44 days without using cash during lockdown

UK consumers have gone an average of 44 days without using cash, according to Nationwide research, which shows the Coronavirus lockdown is accelerating the shift to contactless payments.

A Censuswide survey of more than 2,000 Nationwide members between 23 March and 31 May found that 78.5 million contactless payments were made, up 44 per cent during the period to a total value of nearly £957 million, including a fifth that said they have not used coins or notes at all for two months.

Lockdown has also seen previous cash users switch to contactless methods, with 27 per cent using mobile payments for the first time during the period and 25 per cent using online or mobile banking for the first time.

A total of 44 per cent of respondents said they were worried about the infection risk of using cash and coins, with two thirds saying they have reduced their usage, even if they have not phased it out altogether.

In the week to the 23 March, Nationwide members made 7.15 million contactless transactions with a total value of £77.27 million. By the week to 25 May this had risen to 10.3 million with a total value of £128.13 million.

On a region-by-region basis there were significant differences in levels of contactless payments reported, with the South East seeing 14.48 million transactions between 23 March and 31 May, compared to just 7.39 million in Scotland and Northern Ireland.

Despite 62 per cent of people admitting to using cash less often since lockdown, this trend could outlast the outbreak.

According to Nationwide’s research, half of respondents say they will use cash less in future. More than a third (35 per cent) of this group said this was because they were worried about using cash as a result of COVID-19, while 61 per cent have started using other methods to make payments.

More than a quarter (27 per cent) were committed to doing more shopping online in the future.

The research also showed that one in five people have turned to ‘money laundering’ – cleaning their cash due to concerns around the virus. More than half (58 per cent) have used anti-bacterial wipes, in excess of a third (35 per cent) have done so in the sink with soap and water, while more than one in five (23 per cent) have put their cash in the washing machine.

Mark Nalder, Nationwide’s head of payments, said: “As lockdown restrictions continue to ease, it is evident the pandemic could have a lasting impact on how people pay for things - far from heralding the death of cash, a shift towards mobile payments and online and mobile banking will help people keep track of their spending and better manage their money.

“Although we don’t expect cash to return to pre COVID-19 levels, it is highly likely cash usage will increase post-lockdown as the high street begins to reopen, even if that means the use of card payments - via contactless, phone or another device - rise in tandem," he concluded.

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