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The amount of cash withdrawn from UK ATMs increased in 2015 despite the growing use of alternatives to cash payments.
But is this just a stay of execution while UK retailers, cafés and other businesses catch up with technology that enables them to accept alternative payment methods?
According to LINK, its network of more than 70,000 ATMs was used over 2 billion times last year, with £128bn withdrawn.
The number of withdrawals grew by 0.8% while the total value of the transactions increased by 2%, compared with 2014. The average withdrawal rose from £61.25 in 2014 to £61.93 last year.
LINK’s share of all UK ATM cash withdrawals continues to rise, accounting for about 74% of all cash withdrawals, and the total value of LINK transactions has risen by almost 35% in the past 10 years.
“These figures show that cash remains a very important part of our lives here in the UK and is still the most attractive payment option in lots of situations,” said LINK CEO John Howells.
The increase comes despite growth in alternatives such as contactless card payments, mobile payments and mobile-to-mobile payments. The rise in cash withdrawals might have more to do with a lack of acceptance of alternatives among small retailers. As more and more accept these alternatives, the amount of cash used will inevitably fall.
In Nordic countries, even the smallest retailers accept card payments, whereas in the UK, cards are not always accepted.
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- More payments will be made using smartphones in the UK than those made by cards by 2020, according to 33% of Brits.
- Cash is still the primary chosen payment method for UK residents, according to a survey by payments technology provider Verifone.
- Contactless card payments continue to rise at a rapid rate, with nearly £8bn spent in the UK last year using the technology.
Sweden, for example, is seeing a rapid reduction in the amount of cash used for payments. Circulation of the Swedish Krona has decreased rapidly in the past six years, from over SEK106bn to less than SEK80bn (€8bn) in 2015.
According to Sweden’s central bank, Sveriges Riksbank, cards have become the main form of payment in the country. Only about 20% of retail payments in 2014 were made in cash, compared with 39% in 2010.
Meanwhile, the use of alternatives to cash is increasing. For example, the number of Paym payments, which are sent from one mobile to another using a number, is almost doubling every six months, with 1.46 million payments sent in the second half of 2015, compared with 774,628 in the first six months of the year, said Paym.
The average UK consumer will spend £27 a week via a mobile by 2020 – £10 more than today – while a quarter of consumers will spend more than £50, it said.