15 Oct 2020
The UK is looking into allowing UK shops to offer consumers cashback without consumers needing to make a purchase, that would help to protect people’s access to cash. The Treasury noted that last year, cashback was second most popular way of taking out money.
“We know that cash is still really important for consumers and businesses – that’s why we promised to legislate to protect access for everyone who needs it. We want to harness the same creative thinking that has driven innovation in digital payments to maintain the UK’s cash system and make sure people can easily access cash in their local area,” John Glen, the economic secretary to the Treasury said.
Around £3.8 billion was given out in cashback last year. The most preferred method of money withdrawal was from ATMs.
The change could take place next year, after the Brexit deal is complete as EU rules limit its use. Throughout the pandemic, contactless card payment limit was increased to £45 as consumers were more inclined to make card payments instead of paying in notes and coins.
With a move towards digital payments in plans, the Treasury stated that it has to make sure that no one was left behind.
A number of community access to cash pilots were launched to check whether the vulnerable are missing out and being affected by the move. Natalie Ceeney, the chair of the community access to cash pilots noted, “This is increasingly urgent. Last year we warned that the UK was sleepwalking into a cashless society. Covid-19 has placed even greater strains on the whole system.”