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 Is the UK going cashless? 

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The pandemic has changed the way we look at our finances in a myriad of ways, and this includes how we pay for our purchases. Multiple factors have influenced this, including fewer opportunities to spend physical cash due to lockdown restrictions, less access to cashpoints, and many retailers only accepting card or digital payments. 

We wanted to find out how those factors had impacted UK savers, and whether you think they are likely to lead to permanent, post-pandemic changes. 

 Are we moving towards cash being a thing of the past? Our survey suggests many of you think so. Nearly three quarters of people in the UK think the country is moving towards a cashless society, with one in three predicting this will take place in the next five years.  

So, what is fuelling this trend? Our research found that 67% of people used cash less during lockdown than they did before, with two in three agreeing this shift was likely to be permanent even post pandemic. Only 13% of people surveyed anticipated they would revert back to pre-pandemic behaviours once restrictions lifted.  

Amongst the two thirds of people who admitted to using cash less frequently during the pandemic, nearly half of you agreed that the convenience of contactless payments meant you were more likely to pay by card. Nearly four in ten (38%) felt conscious retailers might not be comfortable handling cash, while one in three preferred not to handle money others may have touched.  

Technology was also a leading factor in influencing how you chose to transact. One in five respondents said they were using cash less frequently due to technological advances, which makes it so easy to pay for goods using smart devices including phones and watches.  

While card remains the favourite payment method for 67% of users, digital payments have also increased in popularity and have now been embraced by 42%, with 17% choosing digital as their favourite payment method. The percentage of digital payment users shot up to 72% amongst 18-34 year olds, whilst it sunk to 15% amongst over 55s.  

Cashless society – good or bad? 

While most of you agreed a move to cashless was on the horizon, many savers were on the fence as to whether this change is a positive thing. Only one in four of people surveyed (26%) see this change as positive, while one in three (34%) see it as negative.  

Cashless society pros and cons 

The leading reason why a move to a cashless society was perceived negatively was the exclusion of less digitally literate groups, which 69% of people in the UK deemed to be important, while the higher exposure of personal information (68%), exclusion of socially marginalised groups (67%) and higher vulnerability due to dependency on IT systems (67%) were also key considerations for most respondents.  

However, you also recognised there would be some big benefits to a cashless society, with reduction of both financial and violent crime the leading positive factors, important to 75% and 73% of survey respondents respectively.   

As the UK emerges from the pandemic, it will be fascinating to see what the ‘new normal’ looks like, and the impact the events of the last year will have had on our lifestyle, attitudes and finances.  

Will the UK go cashless? Only time will tell but it’s certainly interesting to hear your thoughts on the topic! 

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Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551