Card companies have cunning plan to outlaw cash

Paying for juice by credit card reader

Card companies have declared a war on cash. Visa is trialing a scheme in the US, where it pays shops and restaurants to refuse cash transactions. If it is successful, the scheme could be rolled out - and Visa has confirmed that it is interested in bringing something similar to the UK. It would be great news for the card companies, who rake in a fortune in transaction fees, but what would it mean for consumers?

See also: More than half of retail purchases in UK now made by card

See also: Could you do without cash?

Visa is emphasising the security benefits: people would stop carrying large sums of cash, dramatically reducing their risks from pickpockets.

It's also worth noting that the number of payments made electronically in the UK is now higher than the number of cash transactions. According to the British Retail Consortium, cards overtook cash in 2016 - and around a third of all card transactions are now contactless. It means that the change will inconvenience fewer than half of Brits.

There are plenty of people who prefer not to carry cash too. According to Worldpay, around 48% of people can't be bothered with cash - and among those aged 24-34 that figure rises to 60%. The idea of making a specific trip to the cashpoint seems an awful lot of hassle compared to the simplicity of tapping or swiping your card.

We have already seen a number of organisations move to card payments without incident. Many schools no longer accept cash for anything from school dinners to school trips - but instead insist that parents pay online. London buses, meanwhile, went cashless in 2014, and while there was an initial outcry, passengers have got used to the idea.

The drawbacks

However, there are plenty of people who hate to pay using a card for all kinds of reasons. They would be left high and dry if their favourite retailers moved away from accepting cash.

There are some people who use it as a way to keep a lid on their spending. Not everyone finds it easy to manage their money when paying by debit or credit card; in fact in June the Bank of England suggested the use of contactless cards was helping to fuel the growth in consumer debt. In order to counteract this tendency, some people withdraw a fixed amount of cash each day - or each week - and know that once that money has gone, they don't have anything left to spend.

Others have simply never got to grips with using cards, and much prefer tried and tested methods such as paying by cash and cheques. There are large numbers of elderly people, for example, who cannot always remember PINs and dislike ATMs, and so would prefer to withdraw cash from a branch and manage their money that way.

Then there are the huge numbers of families who don't have a bank account - who are excluded from the banking system because of their financial situation. They would simply be frozen out of shopping in particular shops as a result of the move.

But what do you think? Would you miss cash, or are you ready for the change? Let us know in the comments.

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