More than 8 million UK adults would struggle to cope in a cashless society, according to a major report that warns the country's cash infrastructure is in danger of collapsing. The Access to Cash Review, funded by cash machine network Link but independent from it, predicts that cash could fall to just 10% of all payments within the next 15 years.
The review, chaired by former Financial Ombudsman Service head Natalie Ceeney, found that 17% of the UK population – over 8 million adults – would struggle in a cashless society. It calls on the government, regulators and banks to act now or risk leaving millions behind, as debit cards have officially overtaken notes and coins as the most popular form of payment.
The report highlights that the cost of running the UK's cash infrastructure – from ATMs to cash-sorting centres – is about £5bn a year, paid for predominantly by banks and ultimately consumers. However, with costs largely fixed and income declining quickly, the system is becoming unsustainable. The review warns that some companies may exit the market as profitability declines, leading to a risk of disorderly collapse.
Cash machine closures are accelerating, with Which? estimating that ATMs are closing at a rate of 300 a month. Meanwhile, digital banking vulnerabilities were exposed as British banks suffer IT or security failures preventing payments more than once a day on average. Nicky Morgan MP, chair of the Commons Treasury committee, welcomed the report, stating that leaving the future of cash to market forces will not work.
