In the face of changing consumer payment trends, the use of cash as a payment method is declining in the UK. In the 10 years to 2016, cash transactions fell by 35% and are predicted to fall by a further 40% to 2026.
The Access to Cash review suggests that cash use could fall to 1 in 10 payments in 15 years, from a figure of 6 in 10 payments 10 years ago. Against this backdrop, in order to understand what might influence the projected rate of decline, we seek to provide better understanding of factors that influence individuals’ attitudes towards and intentions to use cash relative to other forms of payment, with a particular focus on identifying the impact of behavioural determinants and exogenous shocks.
We design and administer a survey-based questionnaire to examine UK adults’ attitudes towards and intentions to use cash relative to other forms of payment. Using a quota-based sampling method to ensure representation across the full ranges of age, gender and income, through an online survey we obtained responses from 2810 members of the UK adult population.
For the behavioural insights we examine how an individual’s use of mental accounting/budgeting, perceptions of the fungibililty of money, their attitude to loss and their general propensity to habitual behaviour, in the form of routine and automaticity, influence their attitudes towards and intentions to use cash. To gauge the extent to which such attitudes and intentions might shift, we examine the extent to which exogenous shocks influence intentions to use cash both in absolute terms and conditional on baseline levels of intention to use cash.
The project findings will inform future forecasting of the intention to use cash, with such intentions shown elsewhere to be primary determinants of payment behaviours.