There’s been a lot of talk about the death of cash, and we’ve written about some of the new technologies killing cash, and here too.
So is it really on the way out? New figures from the British Retail Consortium (BRC) give us an idea.
Cash is still the dominant payment method in shops and other retail outlets, accounting for 53% of transactions.
But it’s falling out of favour pretty fast. Cash use is down by 14% over the last five years.
The rise of contactless card payments and self-service tills are encouraging people to use their cards more and more.
Debit cards accounted for 32% of the total number of transactions, and 50% of retail sales value in 2013. The retail sales value figure is up by 11% over the last five years.
But the shift to card payments isn’t necessarily great news for retailers. The BRC’s survey found it costs a retailer almost 41p per transaction to process a credit or charge card payment, up more than 18% over the past five years, and 8.8p to process a debit card payment.
It costs just 1.3p to process a cash payment.
“Interchange fees cost the retail industry and its customers almost £1 billion in 2013,” said Helen Dickinson, director general of the British Retail Consortium.
“It is really disappointing that the average cost of accepting both credit and debit cards have increased over five years, while cash costs have gone down.”
So cash isn’t about to die quite just yet – but it’s on the decline.
And retailers would be savvy to plan ahead for how they’ll handle the additional costs of card payments as they increase in use.
This feature might give you some ideas:
7 payment technologies that could spell the end of cash – and change the way you do business