Britain quickly changing into a low-cash society warns ATM community boss JOHN HOWELLS

John Howells is chief executive of Link, a national network of cash machines.

Five years on since the pandemic, many of us will be reflecting on how much life has changed. 

Whether it’s more working from home, how we book to visit our GP or the ways we choose to pay for goods and services, much is different and many of the habits we picked up during the pandemic have stuck.

As the chief executive of Link, I have seen this first-hand across the cash machine network. The way we pay for things has developed significantly, so has the way many of us bank. 

Before the pandemic, around a quarter of all payments were made using cash. Today it’s just over one-in-ten payments. 

You only have to go back to 2016 when cards overtook cash for the first time: it’s less than ten years since half of all payments were made using notes and coins. The pandemic turbocharged the shift to digital.

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We see this clearly in the new data we’ve published exclusively with This is Money to reflect on how cash machine use has dropped from the end of 2019 to end of 2024. 

Pre-pandemic, around £120billion was withdrawn from the cash machine network. At the end of last year, it was just under £80billion.

While there have been stories suggesting an increase in cash use through recent ‘cost of living’ challenges, our data shows that every single Parliamentary constituency has seen a fall in ATM use. 

On average, withdrawals across the UK have fallen by 31 per cent. While we do not see the UK becoming a cashless society anytime soon, we are rapidly becoming a low-cash society. 

Crucially though, the picture is different across the UK and even across different parts of towns and cities.

Our data shows that the steepest falls have been in the largest cities. Central Bristol, Edinburgh, Glasgow and London have all seen the biggest shifts away from cash with ATM withdrawals down by around two-thirds. 

In fact, looking at the top 50 Parliamentary constituencies, many of these locations are in wealthier parts of the country where digital exclusion is much lower.

It’s important to add that, while there is evidence of people experiencing pubs, shops and restaurants discouraging or not accepting cash, these locations are not cashless deserts. 

On the contrary, some of the UK’s busiest ATMs are in city centres. It is rather the case that more people are choosing to pay via card or digital wallets like Apple Pay or Google Pay first.

What’s perhaps more interesting is that in some parts of the country the shift away from cash has been much slower. The reduction in withdrawals has been least in poorer and more rural areas and where digital exclusion rates are significantly higher. 

The Weald of Kent, alongside parts of Leicester, Bradford and Liverpool have seen the lowest shift away from cash. Additionally, across Northern Ireland, cash withdrawals remain higher compared to other parts of the UK.

Many of the things and places where we used to accept cash, now take card. 

Our research shows that cash use is still high in convenience stores and supermarkets, but many people now will use digital if they go to a pub or restaurant. 

Likewise, people who used to visit the cash machine twice a week, because they can now pay using card more often, now visit the cash machine once a week instead. 

While the number of transactions has fallen, people tend to take out more when they do visit.

The main conclusions we can draw from this data is that, despite some headlines, the UK is not becoming cashless anytime soon. 

Lots of good work has been achieved in recent years through the Access to Cash Review, the creation of Cash Access UK to help deliver banking hubs, and the legislation to help protect free access to cash across the country. 

Around five million people rely on cash and it would be unacceptable if we have a scenario where cash users are penalised or unable to buy everyday goods and services.

Consumers on the whole, however, are choosing to pay digitally, and the next challenge should be looking to help more people use digital when they want to, as flagged by our research and the recent Government Digital Inclusion Action Plan. 

Too often, buying in cash means paying a premium over the seamless digital payment options open to others. 

Our job is to protect cash for as long as people need it, but it’s important we don’t simply protect cash for cash’s sake – we should be helping more people into the digital space too when they want to.