The end of physical money is in sight. In use for at least 5,000 years, cash may soon be just a redundant children’s toy.
Change is at sprint speed. In 2011, 55 per cent of UK payments were made in cash. By 2032, only 7 per cent will be in cash.
Just three years ago, the Bank of England estimated that 95.7 per cent of the UK population were within two kilometres of a cash access point; with 99.7 per cent within five kilometres of a cash access point.
Worryingly, in the past five years, as cash payments have declined, nearly 15,000 cash machines have been taken away and more than 2,000 bank branches have closed. The writing is, if not the wall, at least on the computer tablet.
Now nearly a third of adults are registered for at least one mobile payment service, while 86 per cent of adults used a form of remote banking.
But have we gone too far? Is it time for a pause?
The end of the local financial adviser?
Artificial intelligence and fintech, robo-advice DIY platforms, and other digital disruptors can be incredibly empowering but the bread and butter of finance, indeed the gold standard, is local personal service, from mortgages to protection, from an experienced and well-qualified financial adviser.
Although advisers work from anywhere (and at any time) many have a high street presence along with lawyers and accountants. And people still like face-to-face advice.
But the loss of cash ultimately means one of the mainstays of the high street – banks – will disappear. Without cash, bricks and mortar banks are largely redundant.
People in the UK acquire about 93 per cent of their cash from ATMs, with most of the rest coming from bank branches, Post Office branches, cashback and wages, according to a UK Finance report, "UK Payment Markets 2022".
People come to the high street to bank.
They then bring prosperity to all the businesses, including financial advisers, in the area. A prosperous high street means a prosperous back street. Equally, if the high street goes to rack and ruin, more back streets will become slums.
The end of the banks on the high street follows a string of other high street failures: Debenhams, Wilkos and BHS, to name a few example. Now just a few stalwarts remain, including M&S and Nationwide, and the inevitable takeaways.
The aroma of stinky burgers pervades once fine streets all over Britain. Is this the best a nation of shopkeepers can can do for our health and wellbeing?
The clearing banks are retreating everywhere. In my home town, the NatWest in Wallington in the London Borough of Sutton, is closing its doors in September 2024. Barclays in Wallington high street has already gone. Yet cash is still serves a purpose.
The total number of cash payments made in the UK during 2022 increased to £6.4bn (2021: £6bn).
Importance of cash
Without cash, people on the margins of society will suffer; charity collections are already down, student buskers may be no more, and privacy – not always for nefarious reasons – will be lost.
