…By Henry George for TDPel Media.
Analysis conducted by cash machine network Link reveals a significant decrease in cash withdrawals in certain parts of the UK, with a reduction of approximately 60% since spring 2019.
Link’s research highlights substantial variations in cash usage patterns across different regions within the country, including variations within the same city.
The COVID-19 pandemic has contributed to a decline in ATM transactions by an average of 40%, with evidence suggesting that economically disadvantaged areas rely more heavily on cash while larger cities and wealthier constituencies are adopting cashless payment methods at a faster rate.
Regional Variations in Cash Usage:
When examining specific areas within cities, Link’s findings demonstrate a decline in ATM use in Glasgow North East by 33.1% between May 2019 and May 2023.
However, due to changes in ATM visiting behaviors during the pandemic, such as less frequent visits but larger withdrawals, the overall amount of cash withdrawn decreased at a slower rate of 16.8% over the same period.
In Glasgow Central, both ATM use and withdrawal values experienced steeper declines, with a decrease of 59.5% and 46.0%, respectively.
Protecting Access to Cash:
Recognizing that five million people in the UK still rely on cash daily, Link CEO John Howells emphasizes the importance of safeguarding access to cash for as long as necessary.
Deprivation emerges as a significant factor in cash dependency, as evidence suggests that more individuals have turned to cash as a budgeting tool during the cost-of-living crisis.
Moreover, people from disadvantaged communities often lack the digital skills and necessary tools like smartphones and broadband for accessing online banking.
Howells advocates for a careful management of the transition to digital payments to ensure that vulnerable consumers are not left behind.
This includes maintaining an adequate distribution of free-to-use ATMs, expanding services like cash at the till, and providing support to consumers in adopting banking apps and digital payment methods.
Parliamentary Constituencies Analysis:
Link’s analysis covers ATM transactions across the UK and reveals a decline in ATM usage in all parliamentary constituencies between May 2019 and May 2023.
As people visited ATMs less frequently, they tended to withdraw higher amounts of cash during their visits.
The following parliamentary constituencies experienced the largest declines in transactions during this period:
1. Cities of London and Westminster: 64.1% decrease
2. Bristol West: 63.7% decrease
3. Holborn and St Pancras: 63.1% decrease
4. Edinburgh North and Leith: 62.6% decrease
5. Edinburgh East: 62.5% decrease
6. York Central: 60.2% decrease
7. Edinburgh South: 59.9% decrease
8. Norwich South: 59.6% decrease
9. Glasgow Central: 59.5% decrease
10. Bath: 59.2% decrease
Conversely, the parliamentary constituencies with the smallest declines in transactions during the same period include:
1. Liverpool, Walton: 25.2% decrease
2. West Tyrone: 25.5% decrease
3. Leicester East: 26.4% decrease
4. Wolverhampton South East: 26.9% decrease
5. Bradford South: 26.9% decrease
6. Barnsley East: 28.2% decrease
7. Cynon Valley: 28.5% decrease
8. Birmingham, Hodge Hill: 28.9% decrease
9. Stoke-on-Trent North: 29.0% decrease
10. Bishop Auckland: 29.2% decrease
Conclusion:
The analysis conducted by Link highlights the changing patterns of cash usage in the UK, with significant declines in ATM withdrawals observed since spring 2019.
While some regions experience more pronounced decreases in cash usage, evidence suggests that deprived areas rely more heavily on cash as a vital means of financial management.
As the transition to digital payments continues, it is crucial to ensure that vulnerable consumers are not excluded from accessing cash.
Link emphasizes the importance of maintaining a balanced provision of free-to-use ATMs, expanding alternative services like cash at the till, and supporting consumers in adopting digital banking methods.