MPs call for evidence to determine if cash acceptance rules are needed

MPs on the Treasury Select Committee are calling for evidence to determine if new rules are needed to make cash acceptance mandatory across Britain.

There are currently no regulations which require businesses - from shops to restaurants - to accept cash and the evidence will be used to establish the current state of its acceptance in Britain.

It will look at whether businesses should always accept physical cash as well as how much it would cost.

Cash usage has dwindled in the past decade, as people turn mainly to contactless card payments. 

The Treasury Select Committee said cash remains a 'vital resource to many'. 

'Research indicates that the use of cash can provide a vital lifeline to groups such as those with long term poor health or people at risk of economic abuse,' it added.  

Around 3.1million people in the UK rely almost entirely on cash as a form of payment, data from non-profit company Cash Access UK reveals. 

Some 1.5million adults used cash as their main spending method last year, according to UK Finance – the first rise since 2019.

It says this can be attributed to the cost of living crisis, with more people choosing cash to budget. 

Just 900,000 used coins and notes as their primary spending method in 2022.

Overall, cash use dropped last year to make up 12 per cent of all payments – and UK Finance said 22million adults are 'primarily cashless.' 

The decline in cash usage is increasing the infrastructure costs of retaining physical cash as a viable payment method, which could lead to disruption for businesses and consumers, according to the Bank of England. 

Others have highlighted the dangers of an overreliance on digital payments, suggesting cash acceptance should be viewed as a form of civil preparedness. 

There are currently no regulations which require businesses to accept cash.

Adrian Roberts, chief executive of Link, told This is Money: 'Our data consistently shows that people who rely on cash, live in the most deprived parts of the country. But what's more, they are also more likely to be digitally excluded,'

In June this year, the FCA was handed fresh powers by the Government to ensure reasonable access to cash withdrawal and deposits.

Under the rules, banks and building societies have to weigh up whether local communities lack access to cash services, like branches and ATMs, and provide additional services where they find 'significant gaps'. 

The the deadline for submitting evidence to the Treasury Select Committee is 5pm on 2 December.

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