The Payment Systems Regulator (PSR) has published its latest paper on Access to Cash, with research suggesting that despite a strong shift to alternate payment methods, over 80 per cent of Brits paid for something using cash in the previous week.

The regulator commissioned BritainThinks to ask consumers and small businesses from across the UK how they use and accept cash. A telephone survey was used to ensure a demographically representative sample from 1,590 UK consumers, while an online survey targeted 542 UK small businesses.

While the majority of people prefer using cards to make payments, a significant proportion (28 per cent) prefer cash, and those who budget with cash, prefer to pay in cash.

Chris Hemsley, co-managing director of the PSR, said: “Cash continues to play an important role in our economy, and while the use of digital payments is growing, most of us still make regular use of cash.

“This research reveals many important things about how people and small businesses use and access cash, including that most people currently find it easy to withdraw or access cash,” he continued, adding: “But it also highlights the importance placed on being able to access cash by those who rely on cash to help them budget and who do not have access to other payment options.”

In terms of consumers, the research revealed:

• Most (83 per cent) consumers made a payment with cash on a weekly basis.
• A majority (69 per cent) of consumers prefer to use cards.
• Over a quarter of consumers (28 per cent) prefer using cash; especially for budgeting and control purposes (reported by over half of that 28 per cent).
• Nearly all consumers found it easy to withdraw or access cash (95 per cent), something that is true for both those that stated that they prefer cash and those that did not.
• 16 per cent said they need to travel out of their way to access cash, with many seeing a trip to an ATM as part of their normal routine.

As for the small businesses, the survey showed:

• Most small businesses deposit cash in the bank.
• Cash gets recycled through small businesses when they pay suppliers and employees in cash, or it is taken as personal wages.
• Over half of the small businesses surveyed (54 per cent) accept cash, rising to 91 per cent in accommodation and food services.
• A minority of small businesses (13 per cent) prefer cash.
• Small businesses report that their choice of which payment methods to accept is strongly influenced by what their customers want.

This research will contribute the broad debate on consumers’ use of cash and builds on work by other stakeholders, including HM Treasury, the Bank of England and the Financial Conduct Authority.

The PSR is inviting people to share their views on this research and on the implications of these findings. Of particular interest to is how cash usage may evolve in future, and how best to ensure a network of cash outlets which meets people’s needs.

In May, the government announced the Joint Authorities Cash Strategy Group to “safeguard the future of cash and ensure its availability for years to come” and stated a commitment to act on the Access to Cash Review, which made clear that “significant, expeditious action” was needed from government, regulators and industry to ensure that cash access and acceptance is maintained in the UK.

Following the Treasury Committee’s evidence session with members of the Access to Cash Review panel in March, chairperson Nicky Morgan asked the chancellor to commit to implement the review’s recommendations, introduce necessary legislation and make cash policy an explicit responsibility of the relevant Treasury minister.

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