Cash on the Way Out, Contactless and Online Banking Are In

By Michael Moore

British consumers are using less cash than ever before as they increasingly turn to more technologically-advanced payment methods, new figures have shown.

A study by Halifax bank found that just £18 out of every £100 spent in current accounts transactions uses cash, as customers switch to the likes of contactless payments and mobile banking to handle their finances and pay for goods.

Overall, 84 percent of all transactions carried out by its current account customers now involve no cash at all, the bank said.

More Money, More Problems?

In contrast, Web-based payments now account for £15 in every £100, showing how much online banking has grown in recent years, marking the fastest-growing trend amongst Halifax customers.

Debit cards now account for £30 in every £100 spent, however the death of the check seems imminent, being used for only one in every hundred Halifax transactions.

“This trend away from cash is likely to go on as banks innovate and provide customers with more convenient ways to pay for their goods and we continue to see the rise of new, non-traditional entrants into the payments market,” said Halifax’s head of current accounts Nick Young.

“Consumers now have much more choice regarding payment methods and have adjusted their spending habits accordingly.”

The news comes on the day that estimates from Barclays bank predict that shopping via mobile and tablet device could be worth as much as £53bn by 2024, a huge increase from the £9.7bn spent today.

Barclays predicts that by 2024, nearly half (42 percent) of all retail sales will involve a mobile device in some way or another, making mobile the fastest growing retail segment.