Just one in four payments now made in cash

Fewer than one in four payments are now being made in cash - at around half of pre-COVID levels - as businesses and consumers alike look for contact-free ways to pay.

This is according to research from Square, taking data from thousands of transactions across hundreds of small and medium sized businesses across the UK that used its point of sale and payments technology, between January to July.

The report identified that in parallel with the cashless trend, consumers and businesses are increasingly using e-commerce and mobile payments. The percentage of remote payments taken by businesses using Square increased from two per cent in January to 33 per cent in April, at the height of the pandemic.

Square found that 31 per cent of businesses made the move to being cashless by mid-July, from just eight per cent at the start of 2020.

The food and drink sector led the way in going cashless, with a third of businesses in this sector becoming cashless, up from eight per cent at the start of the year. Similar trends have been seen in other sectors, including professional services (29 per cent from seven per cent), retail (24 per cent from eight per cent) and healthcare and fitness (29 per cent from 15 per cent).

Felipe Chacon, economist at Square, said: “Existing trends towards digital and cashless payments and away from cash that have been underway for years have been greatly accelerated as a result of the pandemic.

"Business owners have had to move fast, quickly adapting to new ways of getting paid - they’ve had to balance keeping themselves and customers safe and feel safe, alongside making every sale they can.”

However, a separate report from Loomis, the UK’s largest cash management specialist, showed a significant increase in the number of retailers accepting cash again and a rise in the amount of cash being used by consumers since non-essential retailers re-opened and the ‘Eat Out to Help Out’ scheme started.

At the start of lockdown, the number of cash collections by Loomis fell to 30 per cent of usual levels. Since lockdown measures eased in July, the number of cash collections across the UK have steadily risen to 64 per cent of pre-lockdown levels.

Since the start of August, the number of retailers accepting cash payments again has risen by seven per cent.

Simon Wood, commercial director of Loomis UK, commented: “Since the World Health Organisation confirmed there is no proven health risk to using cash compared to other payment methods, it is clear that consumers are enjoying being given a choice of how to pay for their goods again.

“Whilst digital technology and the impact of the pandemic has driven many to switch to digital and contactless payments, it is clear that cash is here to stay; it still plays a vital and pivotal role for many business and consumers.”

    Share Story:

Recent Stories

Find out how HULFT can help you manage data, integration, supply chain automation and digital transformation across your retail enterprise.
Talking shop: retail technology solutions from Brother
Retail Systems editor Peter Walker sits down with Brother’s senior commercial client manager Jessica Stansfield to talk through the company’s solutions for retailers and hospitality businesses, what’s new in labelling technology, and the benefits of outsourcing printing.