Companies ‘could stop using petty cash’ as use of plastic soars
Petty cash could soon become a thing of the past for UK firms as new figures showed the increasing use of plastic has sent commercial card transactions leaping nearly a fifth higher last year.
Data from banking giant HSBC UK showed contactless commercial credit card payments shot up by almost 24% in 2019.
It said transactions across all its commercial credit cards, business debit cards and corporate cards were up by nearly 20%.
But cash advances on its commercial credit cards dropped by 14% to 91,043 in 2019 in another sign of the rise of plastic over cash.
Tom Wood, head of global liquidity and cash management at HSBC UK, said: “We’re increasingly seeing customers choose card solutions over cash as they look to manage their businesses more efficiently and more securely.
“Contactless transactions are up and the data shows that we’re increasingly seeing businesses use cards for their day-to-day travel expenses – likely because card transactions are far easier to keep track of than petty cash.”
Its report found commercial cards were used most frequently at petrol stations, hotels and building supplies stores.
The data signals commercial credit cards could one day see petty cash become redundant after being used by firms for hundreds of years.
HSBC archives can trace references to petty cash books used by a predecessor to Midland Bank almost 200 years ago, in 1835.
Other references to petty cash in its archives include pages from a petty cash book used at the Paddington branch of a predecessor of Midland Bank in 1895, which documented purchases of items such as envelopes, tea and pins.