According to the latest reports, the UK’s cash system is currently on the tip of the iceberg. In fact, it is being presumed that in the next decade, people in the UK would be finding it hard to deal with a cashless community. In fact, over eight million citizens would be suffering because of the lack of paper money. This lack of cash groundwork is definitely a threat to the society, which would most likely collapse.
Most lenders promote repayments of guaranteed loans with no guarantor, which are made online. Some banks even encourage people to apply for these loans online and offer cash back for every successful repayment which is made in due time. In fact, since they transfer the loan amount directly to the borrower’s account, the borrower prefers to make online payments of bills. With most people turning towards digital payments, banks have decided to shut down ATM’s which has made it difficult for over 15% of the entire population of the UK to make it in the cashless society. A majority of these people belong to rural areas who know very little to nothing about how digital payments work.
ATM closures are currently a major threat to these people who only use cash for their day-to-day transactions. Since banks are seeing closures of their branches because of the inability to make profits, Britons are definitely choosing the digital way but the fact is that those who need to have access to paper money to make ends meet are facing difficulties. ATMs in the UK are closing at the fastest pace of over 200 a month, which adds to the worries of commoners who need cash to make purchases.
The only problem is not just that people would not be able to withdraw money from ATM’s, it’s that a large number of people wouldn’t be able to buy goods from stores, which only accept physical money. Banks and ATMs providing these rudimentary services must ensure that customers don’t face any such problems. In fact, ATMs are definitely the face of modern technology and also one of the chief drivers of automation. Banks do not want ATMs to shut down, it’s actually quite the opposite. Do they not only reduce the need for human staff but also allow consumers to deposit and withdraw cash or use other functions.
As a matter of fact, the operational costs and the decreased number of transactions apart from the new rules and regulations in the UK have left Banks with no choice but to shut down ATMs and branches.
A major contributing factor to the UK’s cash infrastructure is the cost involved with running banks and ATMs, which is ultimately paid by the customers. Despite the fact that the majority of the cost was paid for, the income generation for banks through this system was rather slow. Due to that, the cash system is becoming more impractical and defenceless and can’t be sustained in the long run.
The manufacturing and retail industry is seeing major growth in the number of cashless transactions particularly because of the hassle of handling money. In spite of all of this, the UK is definitely not prepared to go entirely cashless. According to reports, the number of digital transactions in the UK was more than cash payments for the very first time in history. At the rate at which cash is declining, it is most likely to vanish in the next few years. In the past three decades, the ATMs and Bank branches have been cut down to almost one-third and the people who are affected the most by this are the working-class and those living in rural areas in the UK. Three out of ten transactions happen to be with physical cash.
What would happen if cash is wiped out entirely?
If cash happens to be lost, not only would it lead to higher levels of debt and poverty among those who are already poor and rely on cash for their financial planning. People, especially those who belong to vulnerable communities in society, prefer to use cash because of the reliability and convenience that it offers. The cashless system is not completely risk-averse either. This is evident in the fact that online websites and portals of banks tend to face glitches and security failures on a daily basis. This also increases the chances of fraudulent activities. Furthermore, those who lack technical knowledge are definitely left behind. The biggest problem that people face with regards to online banking is not having access to it. The lack of personal interaction also ensures that people don’t become entirely comfortable with the online banking procedure.
The fact that guaranteed loans with no guarantor are deposited directly into the consumer’s account makes it easier for them to make online payments. However, for those who need physical cash, the authorities must come up with a more feasible cash infrastructure otherwise millions of people would be affected drastically.