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Cash no longer king, as bank accounts rule

Cash no longer king, as bank accounts rule

Category: Banking

Updated: 14/04/2010
First Published: 14/04/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
The growing importance of bank accounts has been highlighted, after a new report suggested cash will be used in less than half of transactions in five years' time.

According to 'The Way We Pay 2010' report, published by the Payments Council, a payments revolution occurred in the noughties, and looks set to continue over the next decade.

At present, six in ten transactions still involve cash, although almost 80% of these are for less than £10.

However, in just five years, cash transactions are expected to represent less than half the total for the very first time.

It was also revealed that, while a decade ago one in eight workers were paid cash-in-hand, just one in twenty take their wages home in notes and coins today. By 2018, this is predicted to have fallen to just one in fifty.

The report added that not only had the last ten years seen the rise of internet banking and shopping, but it had also been the decade where cards took control of wallets, with cheques and cash being increasingly replaced by a card - particularly the debit card.

"More and more people have opened bank accounts in the last ten years, and fewer and fewer have jobs in manufacturing where a weekly wage packet is more common," said Mike Bowman, head of policy and markets at the Payments Council.

"Although cash won't disappear in our lifetime, the continuing payments revolution will make it an ever smaller part of our spending. Even the traditional sight of people waving tenners at the bar is fast vanishing. They're more likely to brandish their debit cards now as they compete to get served."

Amongst the announcements made in last month's Budget, basic bank accounts are to be made available to everyone in the UK, a move set to benefit more than one million people over the next five years.

Compare basic bank accounts

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