Cash usage in the UK increased in 2012

Cash usage increased last year in the UK, with consumers and businesses making £20.8 billion cash payments, according to the Payments Council.

This was up from the £20.6 billion paid out in 2011.

Cash usage has been falling every year over the last decade, with the rise of debit and credit cards and the emergence of other payment methods including the use of mobile phones.

However, that changed in 2012 and this may have been a result of individuals being more careful with their funds.

By having physical money people can manage their finances more effectively and it allows them to monitor their outgoings. With debit cards, bank accounts can quickly dry up without individuals realising.

Some 7.2 million adults made all of their day-to-day purchases by cash in 2012, an increase of around 700,000 compared with the previous year.

Cash machines are still the most popular way for people to access their cash. The banking industry has been implementing an initiative to boost the number of ATMs in deprived areas and this has seen the number of cash machines rise to an all-time high of 66,134. 

Crucially, out of those, 46,069 are free for people to use and 97.2 per cent of withdrawals were from free-to-use machines. On average, people in the UK withdrew £66 per transaction using their debit cards.

ATM charges can cause individuals a headache when they check their accounts, as sometimes they may unwittingly use one that is not free to use. It is important for those using cash machines to make sure they are free in order to stop any surprises appearing on their statements.

David Hensley, head of cash at the Payments Council, commented: "Cash is still a vital part of our day-to-day lives, and more than half of all our payments are in cash, reflecting its easy use and its wide acceptance."

By withdrawing and using physical money many people find it easier to keep track of their finances.

By James Francis