Revolut CTO: “UK cashless within 10 years”
Written by Peter Walker
The co-founder and chief technology officer at challenger bank Revolut has suggested that the rise of blockchain technology, contactless and mobile payments, will lead the UK to be fully cashless within the next 10 years.
Vlad Yatsenko opined that financial institutions must adapt to this rapidly changing landscape, with Revolut aiming to be at the forefront of a cashless society.
He used the example of Sweden as leading the way, where 36 per cent of the population claim to never use cash and 25 per cent use it just once a week, falling from 63 per cent in 2013. Cash is now used in less than 20 per cent of transactions in Swedish stores, and the amount in circulation has dropped to its lowest since 1990.
“If the UK aspires to be fully cashless, we need to continue to innovate and encourage the use of financial technology,” stated Yatsenko. “Ideas such as banning coins and banknotes on buses have now been in force for several years, while market traders, street vendors and more now accept card and phone payments.”
However, he pointed out that UK infrastructure lags behind countries like Sweden, which also has the advantage of a smaller population to test things on. “We’ve still got a long way to go until lumbering traditional banks fully adopt cashless technology, and even then not all consumers tend to trust the big banks or institutions with their information or money,” added Yatsenko.
Figures from UK Finance predicted that sales made using notes and coins will fall from 40 per cent to just 21 per cent by 2026. However, research from international legal practice Osborne Clarke suggest that rising concerns over data security and privacy could hinder the reality of a completely cashless society.
In October and November last year, YouGov surveyed 2,000 adults across Europe, finding that 81 per cent of UK consumers are worried about fraud, should mobile payments completely replace cash – up eight percentage points on the year before.
Nikki Worden, partner at Osborne Clarke, said that for many UK consumers, the convenience of cashless payments has often outweighed the security risks. “However, the large number of high-profile customer data breaches reported in the news has caused concerns to grow.”
In addition to fears over fraud and security breaches, Osborne Clarke also found that over three quarters of UK consumers (79 per cent) are also concerned about sharing too much personal data should cashless payments become the only method of payment in the future – a 22 percentage point increase on the year before.
“UK consumers are clearly becoming more aware of the amount of data they are sharing with organisations and are increasingly questioning how it will be used,” said Worden. “The impending General Data Protection Regulation will certainly better protect individuals' personal data and increase data transparency to help curb these concerns. However, businesses also need to understand the responsibility they have in bridging the knowledge gap with consumers about how their data is used.”