Cash payments are continuing to slip in popularity, but cash is still the most frequently used payment method in the UK, according to new figures from UK Finance.
Consumers and businesses made 15.4bn cash payments in 2016, a drop of 11 per cent from 17.2bn in 2015.
But despite the dip, cash is still king for now, as it was used 25 per cent more often than the second most used method in debit cards. More than a quarter of consumer cash payments were for a value of £1 or below, while 61 per cent were for a value of £5 or under.
Last year, cash represented 44 per cent of all payments made by consumers, marking the second year in a row where consumers used cash for under half of all payments. For the same period, cash payments reached £240bn, accounting for 15 per cent of the total value of consumer spending, which was a five per cent dip on the year before.
UK Finance found there were 2.9m consumers who rarely used cash in 2016, representing six per cent of the UK's adult population, with younger consumers more likely to be infrequent cash users. On the flip side, five per cent of the adult population relied almost entirely on cash to make their day-to-day payments last year.
Over the next decade, the number of cash payments is predicted to slide further - by 43 per cent to 8.7bn payments, and the total value forecast to fall by 23 per cent to £185bn in 2026.
Adrian Buckle, chief economist at UK Finance, said:
It is clear that over the past few years we have witnessed a significant shift away from cash use in this country with contactless cards undoubtedly causing a decrease in the use of notes and coins.
However we don’t believe that the UK is on the verge of becoming cashless, as some reports have claimed.
People will always want to choose the payment methods that best suit them and, for the foreseeable future, in lots of cases that will continue to be cash.