Cashback in shops ‘won’t solve cash crisis’

A new law that allows consumers to request cashback in shops without making a purchase will not be enough to protect access to cash, according to new research from Which?.

A study by the consumer organisation found that many people think taking money out this way is inconvenient and even a security risk.

The government launched the new legislation in 2021, with LINK recently announcing it was rolling out the cashback service to 2,000 shops via PayPoint.

But Which? says that this is the only tangible action the government has taken to protect access to cash and believes this does not go far enough.

A Which? survey of more than 2,000 people found only one in six – 16 per cent – were aware of the cashback without purchase scheme, after its launch last summer.

For those who were aware of the cashback option, only around a third – 31 per cent – have used the scheme to access cash, equating to just five per cent of the UK population.

For the 46 per cent of people who said they were unlikely to use the service, the main barriers for using cashback without purchase were perceptions that it would not be a convenient way to access cash -25 per cent of those who say they are unlikely to use the service - the lack of privacy when withdrawing cash – 17 per cent – and 16 per cent would be ‘worried about security issues taking out cash in this way’. A quarter of people who said they are unlikely to use the service, said it would feel unfair to the shop or business to handle the cashback service.

“Schemes like cashback without purchase have a role to play to protect access to cash for those who rely on it, but they won’t be enough on their own to plug the gaps in the UK’s fragile cash system,” said Jenny Ross, Which? money editor. “Our research highlights clear limitations of these schemes, with very low awareness and uptake among consumers, and many people viewing cashback as an inconvenient and insecure way to access cash.

“It’s been almost two years since the government promised to legislate to protect access to cash, so it must move swiftly to ensure that consumers will continue to be able to access cash for as long as it is needed.”

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