Visa is waging a war on cash, with a scheme in the US encouraging small businesses to ditch it as a form of payment.
Chief executive Al Kelly told investors last month that the company was “focused on putting cash out of business,” and is considering bringing the initiative to these shores.
The move is good business sense for Visa, which makes money every time it facilitates a transaction. But is it just a sign of the times?
Now that payments under £30 can be made with the tap of a contactless card, perhaps it’s hard to see why anyone would anyone bother to carry cash.
But figures show the British public still has a soft spot for good old paper and coins. While the number of cash payments fell 11% between 2015 and 2016, cash is still the single most popular method of payment, accounting for 40% of all transactions in the UK last year.
Whether it’s for convenience, symbolism or simply to avoid transaction charges, there are still situations where cash is the best way to pay.
Tipping…if you want to make sure your money goes to the waiter
Most people hope that a service charge would go directly to the waiting staff. But some restaurants keep tips paid for with a card, or distribute them across the whole of the workforce. However, if you choose to leave a tip in cash, you have a much better chance that it will benefit the person you intended it for.
Likewise, if you want to leave money for the housekeeping staff in a hotel, a bartender or a cloakroom attendant, leaving cash is the best way to make sure it gets to the intended beneficiary.
Famously, it was revealed that the Queen does occasionally carry cash in her statement Launer handbag. Why? So that on Sundays so she can make a donation to the church collection. Giving money to a religious service or local event still tends to be a cash-based gesture, while charity collection tins are designed so passersby can put in their spare change as they walk past.
However, quick-off-the-mark churches, charities and even buskers are adapting to our increasing propensity to go cash-free. Pet charity The Blue Cross sent out “tap dogs” last year with contactless payment jackets, allowing the public to “pat and tap the dog” to make a £2 donation.
There are occasional cases where market stalls take card payments. But in general, whipping out a credit or debit card to pay for a punnet of cherries will be met with a blank stare. For small businesses and independent traders, the cost of taking cards can eat into their margins as they have to pay several fees to cover the cost of the transaction.
So for them, cash is often the preferred option -and it means they won’t pass on that cost to you.
Yes, you can tuck a cheque into the card, or ask the recipient for their bank details, but it doesn’t quite have the same effect as a crisp £20 (or maybe even £50) note. And for some cultures the symbolism of cash is particular poignant.
At Chinese weddings, it is customary to give a red envelope containing cash, while in Greece guests are often invited to pin banknotes on to the bride and groom.
At Indian weddings, cash is sometimes given in odd numbers, as giving a sum ending in one is seen as lucky.
Regional buses and taxis
In 2014, London buses went cashless, only accepting pre-paid plastic travelcards or contactless bank cards as a form of payment. By contrast, there are still some bus operators in other parts of the country who only take cash, unless you have bought a ticket in advance.
It’s not just public transport: getting around by car can also be much easier if you keep cash on you. Many know the experience of borrowing 20p from a stranger to feed a parking machine that only takes exact change, while some taxis are still a card-free zone.