The Bank of England’s chief cashier and director of notes has said cash payments were “very much alive and kicking” and that contactless and electronic payments were not a threat.
Speaking at an ATM and Cash Innovation Europe event in London, Victoria Cleland warned businesses to not be complacent when it comes to cash as a rising number of alternative payment methods entice consumers to use them instead.
She highlighted how technology has had a “huge impact”, with ways to pay including digital currencies, mobile payments and innovations such as contactless cards gaining “real traction”.
But contrary to predictions of the eventual death of cash, Cleland said “if we dig further, it is clear that cash is very much alive and kicking”.
She said five per cent of UK adults, spread relatively evenly across age groups, relies almost entirely on cash to make day-to-day payments.
Cleland’s comments come less than a month after Barclaycard confirmed it was testing a checkout-free, cash-free shopping app for the retail industry, while some retailers, such as Waitrose, have already introduced stores that do not accept cash payments.
“Technology is not a threat to cash – it provides opportunities. The Bank has used the latest technology to introduce state-of-the-art polymer banknotes,” Cleland said.
She added: “The rate of change could increase if the cash industry does not respond by keeping prices competitive, continuing to innovate, and having a model that can effectively support cash in an environment of reduced volumes.”
The Bank of England is preparing to roll out training material for retailers and bank staff ahead of its new polymer £10 launch in August.