Move to cashless society ‘could cost region’s businesses their customers’
PUBLISHED: 06:00 03 October 2018 | UPDATED: 09:40 03 October 2018
The move towards a cashless society in East Anglia could cause companies to lose customers, a business lobbying group has claimed.
The impact of bank branch and cashpoint closures has been felt across the region, with some places such as Bungay losing all their physical banking facilities.
And the Federation of Small Businesses (FSB) says the impact of these closures is being felt by businesses as well as consumers. Half of its East Anglian members say they are already a kilometre or more from their nearest cash point, and six in 10 in the retail sector believe cashpoints are important to the success of their firm.
It follows new research by consumer group Which?, which found that a move to a cashless society would disproportionately affect the elderly and those on lower incomes, who are more likely to use cash, as well as businesses which are reliant on it for payments.
While some businesses have embraced a cash-free way of working – with Suffolk being home to the UK’s first cashless pub – others are still reliant on the services offered by bank branches.
Which? said the frequency with which consumers still use cash – only 5% of those polled said they rarely use it – “highlights the importance of cash for businesses that often rely on it as their primary payment method”, with 52% of respondents saying they preferred to be paid in cash for goods or services they had provided.
FSB East Anglia area lead David Howell said the Which? findings offered further evidence that bank branch and ATM closures are “continuing to hit the most vulnerable hardest”.
“Going cashless can be beneficial to some small firms but, for many, being forced to refuse cash will only mean that customers are lost,” he said.
“Many consumers still want to use cash, which in turn means small firms need to be able to access bank branches and cash deposit facilities.
“But as branches disappear from towns, villages and high streets across East Anglia, smaller businesses are left with the risk of leaving potentially large sums of money on premises, or being forced to travel long distances to reach their nearest bank.”
Mr Howell, who runs a training business in Watton, said shoppers “still want to see banks on the high street”, adding that high-profile cases of online banking and payment card services failing – such as the Visa crash in June or online banking problems at TSB, HSBC and Barclays – had knocked consumer confidence in digital banking.