Cash spending falls behind credit card payments for the first time

Cash payments have dropped to third place behind debit and credit card spending in 2018 for the first time.

The British Retail Consortium’s latest Payment Survey found that debit cards are still the most popular method of payment, accounting for almost three-in-five transactions.

The use of cash payments has been falling steadily over the past five years and there is 50% less transactions since 2013.

Nonetheless, cash remains an important part of retail, particularly for many vulnerable people, and the BRC is working to ensure the long-term viability of ATM.

Total UK retail sales rose by 4.1% to £381bn, from £366bn the previous year. There were 20.1bn transactions in a single year (more than 55 million transaction a day) up from 19.8bn in 2017.

The BRC are also calling for action to improve regulation of card payment fees, expanding and simplifying the regulation to cover the full range of transactions and prevent abuse by card companies. Each transaction cost retailers an average of 5.85 pence per transaction, up 17% (from 4.98 pence).

Andrew Cregan, Policy Advisor Payments and Consumer Credit, said: “With card payments accounting for almost 80% of retail sales, it is vital that the Government takes action to tackle the soaring costs that card companies charge retailers. Without action we will see businesses put under further pressure and it will be consumers who are forced to pay the price.”