In the UK, approximately half of transactions are still made with cash. However, Which? reported that “Nearly 3’000 bank branches have closed across the UK since 2015 and that ATMs are shutting down at an estimated rate of 300 a month, mostly impacting rural communities. While the PSR is struggling to sustain the number of cash machines, big companies of the payment industry such as Visa and MasterCard are aiming at the decline of cash, which penalises the poor and the small businesses”, The Guardian says .
The rising tendency of credit card usage particularly affects the 2.7 million people using mostly cash and the unbanked population. With the disappearance of ATMs, residents of small towns encounter difficulties in withdrawing cash and are forced to commute long distances for this purpose. Cash users are additionally “being increasingly penalised as the best deals for utilities, telecoms and even train tickets are only available online to cardholders”, mentions The Guardian.
The war on cash is also constraining small retailers in areas lacking cash points to endorse card POS terminals, which are three times costlier as Visa and MasterCard are regularly increasing fees on card transactions following the EU’s cap on interchange fees. In order to alleviate these costs, local merchants have no choice but to raise prices, impacting low income households.
David Clarke, head of policy and advocacy at Positive Money stated that “if consumers are unable to get hold of cash, it’ll leave card companies free to hike charges on payments.”