British people, forced to avoid using cash during the Covid-19 pandemic, are getting used to life without it.
According to a survey from Nationwide Building Society, the lockdown, introduced to reduce the spread of Covid-19, will have a long lasting effect on the use of cash in the UK.
The survey of 2,000 people found that the average respondent has gone over six weeks without using cash. Digital payments are unsurprisingly increasing, with many people using them for the first time. In fact, lockdown has forced 27% of respondents to use mobile payments and 25% to use online or mobile banking for first time.
This could have a permanent impact on the use of cash in the UK. Nationwide found that 50% of people will use cash less in future, and 61% have started using other methods to make payments.
Nationwide customer habits reveal a spike in contactless payments during the Covid-19 lockdown. In the week from 23 March, when the lockdown began, 7.15 million contactless payments worth £77.27m made by Nationwide customers, compared with 10.31 million, worth £128m, in the week beginning 25 May.
The older generation, typically more cautious of adopting new ways of managing their finances, have been forced to change their habits. According to the survey, three quarters (75%) of Nationwide customers over 55 have reduced their cash usage, compared with just 48% of people aged 16-24 and 57% of customers between 35 and 44.
Retired banker Ron Warmington said the lockdown has dramatically changed how he transacts. “I used to draw out £300 a week, which I last drew out just before the lockdown (23 March), and I only just finished that off yesterday. I am using Amazon and eBay all the time, and PayPal is my default payment method,” he said, adding that he is also being forced to use contactless in the shops.
Mark Nalder, Nationwide’s head of payments, said a shift towards mobile payments and online and mobile banking will help people keep track of their spending and better manage their money.
“Although we don’t expect cash to return to pre Covid-19 levels, it is highly likely cash usage will increase post-lockdown as the high streets begin to reopen, even if that means the use of card payments – via contactless, phone or another device – rise in tandem.”