UK ministers have been put under new pressure to protect access to cash as increasing numbers of Scots turned to contactless while there was a dramatic slump in use of banknotes and coins.

The UK Finance's latest Payment Markets Report, reveals that Scots were amongst the highest users of contactless cards in the UK.

An analysis of nine regions of the UK shows ti hat 87% in Scotland made contactless payments in 2020, only bettered by North and Yorkshire (88%) and Northern Ireland (91%).

The number of cash payments across the UK dropped by 35% in a year - but UK Finance, he trade association for the UK banking and financial services sector, recognised that Covid-19 had a dramatic effect on the amount of spending that has taken place.

They said that while cash was used in 45% of payments in 2015, now it has slumped to just 17% in 2020.

That has coincided with a rise in the number of contactless payments made in the UK in 2020. There are now 9.6 billion payments, a rise of 12% in a year.

Overall, contactless payments now accounts for more than a quarter (27 per cent) of all UK payments.

The rise of contactless has seen it jump from being just seven per cent of all payments in 2016 to 27 per cent now.

But cash remains the second most frequently used payment method behind debit cards.

Natalie Ceeney, chairman of the Access to Cash Review has now called on UK ministers to act swiftly to prevent the loss of coins and banknotes fearing the changes in behaviour during lockdown might not change.


There is concern the government is still yet to introduce legislation to protect cash it promised almost over year ago.

Ms Ceeney, who is now leading the industry Access to Cash Access Group said: “Given that lockdowns restricted many people to their homes in 2020, it’s not surprising that many people switched to digital payments. Some of these changes will inevitably 'stick', leading to increasing numbers of people who rarely use cash at all. It’s clear that the future is increasingly digital.

"However, what this UK Finance report shows is that cash remains the second largest payment method behind cards, and represents just under a fifth of all transactions. There are also over five million people in the UK that are heavily reliant on cash. At the same time, as cash use declines, there is an increasing risk that people won’t be able to access it, or that shops won’t accept it. It’s not a case of waiting for people to ‘learn to use digital’. Digital payments don’t yet work for everyone, for a wide variety of reasons.

"The government’s commitment to legislate to protect cash remains critically important. I also hope that the work we are leading with industry and consumer groups to develop a sustainable cash infrastructure will find ways to address these challenges quickly."

UK Finance, which said the lockdown had a far-reaching impact on the amount of payments in the UK added that their findings are a reflection on how consumers were encouraged to pay by card when shopping.

In April 2020, the industry increased the spending limit on an individual contactless card payment from £30 to £45 in order to help with this.

Some 59% of payments were made by card, including use of contactless, in 2020, up from 56% in 2019.

But the number of card payments actually fell from 20.4 billion to 19.6 billion in a year, the result of the fact that huge parts of the economy were shut down for significant parts of the year.

John Howells, chief executive of Link, wich oversees the UK's largest cash machine network said: "It comes as no surprise that cash use has fallen. At the beginning of the pandemic in April 2020, ATM transactions fell by as much as 60%. More people are now comfortable using contactless payments and shopping online.

"ATM visits are still down almost 45% compared to the same time two years ago. Clearly, the UK is becoming more digital, however there are still several million people reliant on cash. LINK will continue to protect access to cash for as long as needed, but we also need a plan to make sure that digital eventually works for all."

During 2020 there were 13.7 million consumers who used cash only once a month or not at all, a significant increase from 7.4 million consumers the previous year.

Gareth Shaw of the consumer organisation Which said: "While the past year has accelerated the shift to digital payments, those who still depend on cash to pay for everyday essentials must not be forgotten. Cash also remains an important fallback option for when digital payments fail, while some consumers may simply not be ready or able to take advantage of these payment methods.

"UK Finance's Access to Cash Action Group that was formed last month needs to quickly set out what it intends to do to back up its commitment to safeguarding cash, while the government must make progress on its long-promised legislation to protect cash and ensure it remains a viable payment option for as long as it is needed."