5 Reasons Why We Still Need Cash
It’s a fairly well-known fact that cash is no longer king. In fact, research suggests it hasn’t been king for quite some time, as more and more people are now choosing to use either debit or credit cards to make purchases.
According to recent figures from the British Retail Consortium, cash has gone from the most common way to pay for shopping in the UK to third – in only a few shorts years. It now accounts for just £1 of every £5 spent in shops, with contactless, phone and watch payments all increasingly growing in popularity.
You may therefore find yourself asking: why do we still need cash if we don’t use it anymore? Shouldn’t we be adopting these new and improved methods of paying for goods instead?
Well, no not quite yet – cash still has a major role to play in our society. Listed below are five key reasons why.
Not everywhere accepts cards
Nothing beats a greasy kebab from a food truck after a night on the town, or a cheeky purchase from a handicraft stall while out shopping. However, these sorts of places often require you to pay with cash, mainly because the vendors can’t afford to offer card payment alternatives.
Just because you have a fancy phone or watch that can pay for things with a simple tap, that doesn’t necessarily mean everywhere else is up to your level of digital savviness. Roadside stands, super hole-in-the-wall restaurants and food vans often only ever take cash so, unless you want to trade your fancy phone for a burger, you’re going to need some cash.
It’s great in an emergency
Let’s set the scene: you’re on a night out enjoying yourself when you realise you’ve run out of drink. You head to the bar, order another one, and get your wallet out ready to pay. Suddenly, you realise that your card is missing – you must have lost it dancing earlier on.
In these types of situations, having cash available can make a huge difference. Not only can it allow you to buy that drink you were after, but it also enables you to carry on enjoying your night, and get home safely in a taxi when you’re ready to head back home.
It makes tipping easier
When you visit a restaurant, it’s usually courteous to leave a tip. While some restaurants include this on the bill beforehand, or make a point to ask for it on the card reader itself, many people prefer leaving a handful of cash behind instead – depending on the quality of service provided.
Similarly, if you use a card to pay for purchases at a smaller restaurant, service provider or store, they won’t actually receive the full amount of money you pay. This is because using a card machine actually costs the company money themselves; somewhere between 0.6 – 3.5% of the purchase price, plus an additional fee on top.
Cash prevents overspending
If you are looking to stay in control of your finances, many studies have shown that people spend a lot more when paying with a credit card, compared to cash. This is because the tangibility of actually having to part with cash makes the ‘pain’ of the payment process feel much more real. By using a credit card, you don’t see the money leave your account, so the whole process of paying feels like it hasn’t even happened.
The pain of paying with a card only sets in once you make the brave decision to actually look at your bank balance.
Cash protects your privacy
Cash, on the other hand, is relatively untraceable, as it leaves no track record of who handled it, when, and at what time. Therefore, if you’d rather keep your data and purchase records to yourself, cash is the only means of doing this.
This doesn’t have to be for any criminal motive either: say you have a joint bank account with your partner and are on the lookout for a birthday present for them, they could easily see what you bought them if you paid for it using the joint credit or debit card. Surprise ruined.