Debit cards and contactless payments
Within the last few years, the use of debit and credit cards has been normalised. Parents open under 19 bank accounts for their kids at a young age, and seeing a nine-year-old paying for his snacks at a self-checkout in Tesco with his debit card is extremely common. Paying contactless is quick and easy which is exactly what stores like Aldi want to efficiently move the line at the tills and decrease customer waiting times; and this payment method is also appreciated by people that are always on a rush. With COVID-19 and the efforts made by all businesses to minimise contact between strangers, the maximum amount for contactless paying has gone from 20£ up to 100£. Digital payments in the United Kingdom are set to grow by 15.17% within the next 4 years.
My personal experience with cash
As a 21-year-old university student, I received my first debit card when I was 17 years old - I have been using it ever since and it has made my life easier. Remember the old times when you had to wait for the cashier to tell you the total you owe for your shopping, and you had to dig into your wallet to find your coins? I am sure we have all been there at least once in our lives, but with my card I can just pay by tapping it on the machine and go about my day; a lifesaver!
Paying by card also allows me to use mobile banking which I personally find extremely helpful because I can send money to my friends from the comfort of my home, however there is a limit to the amount of money that can be sent without an identity check for safety purposes.
Mobile banking gives me a sense of safety because if I were to lose my card, I could easily report it as lost or stolen so that the bank immediately freezes it in case a stranger finds it and tries to use it. But most importantly, paying by card allows me to keep a record of all my spendings during the month when I receive my bank statement.
Cash in the future
Some experts claim that by 2050, nobody will use cash as a method of payment. I disagree with these claims, because a survey was recently conducted where the EU population was asked about their payment attitudes. They found that cash was the most frequently used payment method, and card payments were the second most used methods. In terms of value of payments, cards were used for bigger purchases while cash is used for smaller purchases, and online payments were used mostly for buying food from restaurants and supermarkets. However, most of the consumers consider having cash as a payment option to be very important. These findings show that although card payments are preferred for big purchases, having the choice to be able to pay in cash for smaller things is also very important for consumers.
I think that being able to pay in cash allows people to keep anonymity when it comes to certain purchases, because every card or online payment is tracked, therefore people will never give up cash completely to keep some of their privacy.
A few tips
One thing that I would advise young people to do as soon as they turn 18, is to get a credit card as well, instead of only using their debit cards. This will allow them to build up a good credit score over time by making some purchases and paying back the money on time. Therefore, in the future, once they decide to buy a house, it will be easier to get a loan from the bank with a decent credit score.
One recommendation that I would give is to not buy expensive things with your credit card if you will not be able to repay it back on time, because that will not give you a good look in the eyes of a bank when asking for a loan.
In conclusion, I think it is safe to say that although people use card and online payment more often, we are not going to witness the demise of cash any time soon.