The tooth fairy’s days are numbered.
Pocket change may soon be completely replaced by electronic payments in the UK after reports that last year, for the first time, the majority of payments were made without cash – either on the internet or phone, or through electronic payments and cheques.
The proportion of cash payments was less than half the total number of payments made last year, falling from 52 per cent in 2013 to 48 per cent in 2014 for consumers, businesses and financial organisations combined, according to the Payments Council.
Non-cash payments are expected to overtake cash payments by consumers for the first time next year. The idea of a completely cashless society is not so far off.
Some of us already cashless. Dave Birch, author of 'Identity Is The New Money' said that young, middle class women are most likely to have made the transition to electronic payments.
He said poorer people are more likely to use cash – meaning they get caught with cash machine charges and are unable to get the best deals online.
Cash is also used for money laundering and tax evasion. "Cash is bad for society in that respect," said Birch.
"In countries that are already mostly cashless such as Denmark, Finland and Sweden, the total cost to the economy of the payment system is less," said Birch.
Birch said that for the UK to become entirely cashless, the government would have to get behind the idea with policy changes.
Countries that almost exclusively use cash most often do so because they don’t have the infrastructure in place to support electronic payments. Some, like Italy and Greece, still prefer to use cash for cultural reasons.