New figures indicate that cash use is very much on a decline across Britain as the number of transactions involving physical currency has fallen by 14% over the last five years.
The rise of e-commerce and new shopping models like click-and-collect are thought to be playing a huge part in this trend as retailers start to warm to other, more innovative ways of collecting payment.
Released earlier this week, data from the British Retail Consortium (BRC) shows transactions involving debit cards rising 2% in 2013 compared to 2012, accounting for 32% of all payments made, while cash use dropped 3% over the same period.
The BRC report highlighted that debit card transactions have risen by 11% over the last five years, although cash still held the lion’s share in 2013 by accounting for 53% of all payments made.
However, other readings show that average cash transaction values are falling and analysts say customers are already taking advantage of new ways to pay for their goods.
Some have labelled this shift as a “milestone” in the development of Britain’s digital economy as contactless cards and self-service tills take centre stage alongside a huge uplift in online sales.
A man fully aware of the impact that online shopping has had on the use of physical currency is Dan Wagner.
As the CEO of Powa Technologies and brains behind new mobile e-commerce app Powatag, Wagner has seen increasing evidence of companies providing customers with shopping methods that render cash irrelevant.
Talking exclusively to PerformanceIN, Wagner said: “E-commerce has had a very strong impact on the reduction in cash payments, as it means that an increasing number of shoppers aren’t even contemplating sales in store, let alone using physical money.”
Retailers take advantage
Wagner cites research from IMRG and Capgemini which highlights that online sales grew to 21% of all retail over 2013, meaning cash is not even considered in a fifth of all purchases made.
Thus, he believes stores must move with the times by considering electronic methods of payment.
“Retailers must provide their customers with as many payment options as possible, as they are increasingly risking sales if they cannot provide flexible options such as click-and-collect and mobile payment.
“It’s important for them to stop considering their online and offline strategies separately, instead focusing on a single, combined offering.”