Non-cash payments overtake cash payments for the first time
Data from Worldpay, the UK’s leading payments processor, reflects a significant shift in the way British consumers are paying for goods, with High Street credit and debit card transactions rising just over 6% in 2014, following similar gains the previous year.
Londoners are responsible for the single biggest year on year rise in card spending. Transaction volumes on credit and debit cards in the Capital have risen by 9.3% in the past year. Cosmopolitan Leeds is not far behind however, with card-based payments rising by 8.9% in 2014, while Reading (8.0%), Southampton (7.9%), and Liverpool (7.7%) are also creeping towards the cashless tipping point.
Worldpay believes a migration of low value cash payments to card, alongside increasing use of contactless are pushing the UK closer to the point where cards overtake cash as the dominant payment method on the High Street. Recent data from the British Retail Consortium suggests cash use is down by 14% over the past five years across the UK.
Worldpay’s claims are backed by its data which shows a steady decline in average transaction values for credit and debit cards, from £31.51 in 2012, to £29.67 in 2014, an overall drop of 6%. In the fast-growing contactless sector meanwhile, where the number of transactions processed has risen by 150% in the last six months, transaction values have levelled out at around £7.24.
Cash may not be quite done with yet, but it is clearly losing its appeal, particularly among tech-savvy Gen Y’ers. Worldpay research of 2000 consumers found the majority of Brits over 45 years old still like to have cash on them, nearly 60 per cent of 25-to-34-year-olds would prefer to never carry cash.