UPDATE: The BRC 'Key Results' table (pictured below) emerged as correct following a conversation with a BRC source who agreed their message lacked clarity. As such, please take the below with a pinch of salt.
Last week a number of media outlets reported a BRC (British Retail Consortium) story on "the death of paper money" (also here) or how "UK shoppers use less cash" (also here).
Last week a number of media outlets reported a BRC (British Retail Consortium) story on "the death of paper money" (also here) or how "UK shoppers use less cash" (also here).
The key point, as summarised by the FT:
[Cash] use has declined as a percentage both of number of transactions, which was down 6.7 per cent, and total money spent, which was down 9.7 per cent.and an infographic from City A.M.:
At the source, the BRC Cost of Payment Collection Survey 2012, lists the following:
Cash is still, however, the dominant payment method by number of transactions, accounting for 54.4 per cent of transactions. However, even this is down by 6.7 per cent during 2012 (2011: 58.3 per cent).
The value of cash used by customers to make payments, whilst accounting for 28.9 per cent of total turnover, is down from 32.0 per cent last year. Cash turnover is down by almost 10.0 per cent year on year.and the following tables
(1) % of turnover by number of transactions
(2) % of turnover by value
Focusing on the top two metrics, by now you may have spotted that cash decline as both a proportion of the total number of transactions recorded by the survey and a proportion of total money spent, was calculated as such:
(1) 6.7% is the difference between 54.35% and 58.27% (3.92%), over 58.27 (0.067273%) times 100 or 6.727%%; and
(2) 9.7% is the difference between 28.93% and 32.03% (3.1%), over 32.03 (0.096784%) times 100 or 9.678%%.
While correct, this approach is potentially misleading, especially when representing thousands of millions of transactions and billions of pounds.
Using absolute yearly figures rather than percentages (i.e. yearly percentages of cash times total turnover) the results show a different picture: 65.58m fewer cash transactions in 2012 than in 2011 and £4.36bn less cash used at retailers. As such, cash use has declined by 1.2% when accounting for transactions and by 7.6% when accounting for payment method, making the death of paper money perhaps less imminent to British consumers, at least for the time being.
