Millions of people would struggle if the UK became completely cashless, report finds

p00hsticks

Sorry, I've come late to this thread, so apologies if it's already been mentioned, but can anyone provide any info on how much it typically costs a small business to process a contactless card transaction ? When I used to work in the industry around 15 years ago I think it was around 30-40p for a debit card transaction but I imagine it's come down since then ?

I ask because the main business I know that only takes cash payments is the local newsagents - and I'm guessing that the main reason is that the cost of processing a transaction for a single newspaper would more than wipe out any profit margin they may have.... 

The only other places I've needed cash for recently is a charity book sale and a local society that charges a small admission fee to its meetings (plus cash for refreshments and raffle).  I occasionally spend cash elsewhere to get change for these.
Like a previous poster I keep a £1 token in my pocket for use in supermarket trolleys. 

ZeroSum

p00hsticks said:

Sorry, I've come late to this thread, so apologies if it's already been mentioned, but can anyone provide any info on how much it typically costs a small business to process a contactless card transaction ? When I used to work in the industry around 15 years ago I think it was around 30-40p for a debit card transaction but I imagine it's come down since then ?

I ask because the main business I know that only takes cash payments is the local newsagents - and I'm guessing that the main reason is that the cost of processing a transaction for a single newspaper would more than wipe out any profit margin they may have.... 

The only other places I've needed cash for recently is a charity book sale and a local society that charges a small admission fee to its meetings (plus cash for refreshments and raffle).  I occasionally spend cash elsewhere to get change for these.
Like a previous poster I keep a £1 token in my pocket for use in supermarket trolleys. 

Depends what else they sell I suppose, as they could accept not cash payments but set a minimum £5 spend (my local chippy does this)
If its just newspapers, magazines & sweets then it probably won't be worthwhile. If it's also an off license, then it might be.

Rob5342

Alex9384 said:

You don't have to use cash but simply having that option should never be taken away from us.

Handling cash costs money, and banks and companies won't cover that cost unless there is sufficient demand, so if you want the option then actually you do have to use it.

badmemory

But a small corner shop type shop may mostly deal with cash at the cash & carry & pay any staff also in cash, so they may not actually be banking much cash.

p00hsticks

ZeroSum said:

p00hsticks said:

Sorry, I've come late to this thread, so apologies if it's already been mentioned, but can anyone provide any info on how much it typically costs a small business to process a contactless card transaction ? When I used to work in the industry around 15 years ago I think it was around 30-40p for a debit card transaction but I imagine it's come down since then ?

I ask because the main business I know that only takes cash payments is the local newsagents - and I'm guessing that the main reason is that the cost of processing a transaction for a single newspaper would more than wipe out any profit margin they may have.... 

The only other places I've needed cash for recently is a charity book sale and a local society that charges a small admission fee to its meetings (plus cash for refreshments and raffle).  I occasionally spend cash elsewhere to get change for these.
Like a previous poster I keep a £1 token in my pocket for use in supermarket trolleys. 

Depends what else they sell I suppose, as they could accept not cash payments but set a minimum £5 spend (my local chippy does this)
If its just newspapers, magazines & sweets then it probably won't be worthwhile. If it's also an off license, then it might be.

No, they don't sell alcohol or tobacco - apart from papers and magazines they have some small items such as sweets, crisps, canned drinks, stationery items, postcards and greetings cards but I think the vast majority of customers are regulars who call in everyday just to buy their daily newspaper, so i can't see a £5 minimum spend working for them.

Alex9384

Ergates said:

Alex9384 said:

You don't have to use cash but simply having that option should never be taken away from us.

Having that option comes at a cost.   Are *you* willing to bear that cost if the majority of people don't want it?  Or do you expect other people to pay for your choices?

Sure. And many other people, such as victims of financial abuse who rely on having some cash stashed aside.
If everything is electronic, you can't hide sh*t anymore.

Regarding the cost, didn't really cost me that much over the last 30+ years.
How will that cost go down for you when cash is abolished? You think banks will pass on the saved cost on you, lol? How do you like paying the cost of payment processors and credit card rewards and bonuses that are passed onto all consumers?

And if banks introduce negative interest rates, are you willing to pay for having your money just sitting in your account? Because you won't be able to withdraw it and put in under the mattress anymore.

Don't people really care about privacy? You really want to be tracked 24/7 just because "I have nothing to hide"? Do you know who will be in power in 20, 50, 100 years from now? What if you or your kids become "inconvenient" to someone? Just like Russia was cut from SWIFT payments, same thing can be done to an individual person. With no physical cash, you will be f**ked.

Ergates

Alex9384 said:

Ergates said:

Alex9384 said:

You don't have to use cash but simply having that option should never be taken away from us.

Having that option comes at a cost.   Are *you* willing to bear that cost if the majority of people don't want it?  Or do you expect other people to pay for your choices?

Sure. And many other people, such as victims of financial abuse who rely on having some cash stashed aside.
If everything is electronic, you can't hide sh*t anymore.

Regarding the cost, didn't really cost me that much over the last 30+ years.
How will that cost go down for you when cash is abolished? You think banks will pass on the saved cost on you, lol? How do you like paying the cost of payment processors and credit card rewards and bonuses that are passed onto all consumers?

And if banks introduce negative interest rates, are you willing to pay for having your money just sitting in your account? Because you won't be able to withdraw it and put in under the mattress anymore.

Don't people really care about privacy? You really want to be tracked 24/7 just because "I have nothing to hide"? Do you know who will be in power in 20, 50, 100 years from now? What if you or your kids become "inconvenient" to someone? Just like Russia was cut from SWIFT payments, same thing can be done to an individual person. With no physical cash, you will be f**ked.

There are forms of electronic payments (some mentioned above) that aren't linked to an individual if privacy is your concern.  They are, obviously, less secure because they're linked to the card rather than the person (so if you lose the card you lose the money).   If you're concern is people hiding money from abusive partners (rather than the state), then it's a lot easier to hide money electronically than it is to hide a wodge of cash.  If you're worried about a malicious state, then having a bit of cash hidden away isn't really going to make any material difference.

Regarding cost - it has cost you over the last 30+ years, you just haven't seen the costs because they're embedded, they're part of the cost of doing business and all consumers are paying for it whether they use cash or not.  Exactly the same as with card transactions.

In most of the world, you have to pay for a bank account, we're just used to having free accounts.   Except they're not really free (running a bank costs a lot of money) and historically banks have made a lot of their money from things like overdraft fees, which means that the people who can least afford it have been paying for the rest of us to have free accounts.  As more and more of these avenues of income are shut down then it'll become more likely that banks will start charging for accounts directly.

Abbafan1972

I pay cash at the hairdressers, as they have a minimum card payment of £25 and my hair is £20. Although she still asks me if I’m paying cash or card! 

The only other 2 times I use cash is for a group I go to once a week and we put the money in the box to pay for the room hire. Also I go to SlimmingWorld and use cash to buy their bars sometimes. 

Everything else I use card or bank transfer. 

MrFrugalFever

In response to a question raised regarding costs to businesses for transaction types, I believe a debit card is anywhere between 0.2-0.4% transactional fee and a CC from 2.7-3.1% transactional fee, but I cannot say fro sure. I am also not sure if certain MCC’s affect this rate (along with international exchanges).

in short, it is most likely less than paying someone to count, handle and bank the money. Back when I was a student I worked in a shop and every Sunday I had to count a ‘float’ in the till, record that in a book, remember how much money I had taken so as to not allow the till to exceed a set amount of holding and then ‘cash up’ excess amounts during the day. At the end of the trading day, I then had to count it again, bag it in relevant bags depending on whether it was coins or notes, sign a slip and transfer it to the manager who would then ‘cash up’, log in a book, log on a computer spreadsheet and then 2 of us has had to drive to a main bank and post the money through the money vault in the wall outside with relevant company information in a secure bag. No doubt the bank then had to spend time checking and processing thing.

HOW LABOURIOUS.

Sorry, but no argument raised about keeping or needing cash has been a valid one thus far. Even charity fundraisers in the street or burger van owners can take electronic payments (whether that’s an authority to set up  DD or instant debit card payment).

We are all already paying for the privilege of contactless and such like as this would have been calculated in the cost of goods a long long time ago and passed on to the consumer.

Rob5342

Things like eBay have become more practical partly because things can be paid for without having to move cash around.

The reason we had cash to begin with was because it would have been completely impractical to have people manually keeping track of every single transaction, now it's much more practical to do that electronically than it is to carry cash around.