Technorati Tags: cash
The survey came from go&pay who have an internet payment system that targets cash buyers. The idea is that a customer places an order with an online merchant and is presented with an invoice that includes a bar code. The customer prints this out, and then takes it one of 20,000+ corner shops with the appropriate terminals, where the bar code is scanned and the customer pays (eg, with cash).
Their survey reports that nearly a million people in the UK “choose” not to have a bank or building society account (2% of the total population over 18). The survey spin doctors call them “MUMs”, standing for Money Under the Mattress’. Nearly half these MUMs say they “prefer to be in control of their finances themselves” (I have no idea why this means not having a bank account) while 16% say they “just don’t trust banks”. Another 16% say they have a partner with a bank account so they don’t need one. I’d say these kind of numbers look pretty promising for the pre-paid enthusiasts.
Some more figures for Powerpoint charts: of the employed MUMs, one third get round the problem of not having an account by being paid cash (I’m sure it’s not the only problem that it gets around), while another third get a cheque and take it to a cheque shop. Note also that half of the MUMs own property. But here’s the best bit: the MUMs do worry about security, so a quarter of them hide it under the floorboards and 5% really do keep their cash under their mattress.
I suppose the idea of the this survey is to show that people have cash that they could spend on the internet if only there was a way. And, in fact, other surveys show that people would spend more if they had such a choice. Javelin’s Annual Consumer Payment Poll showed, for the fourth straight year, that a majority of consumers would spend more online given options beyond cards.
A couple of months ago Yorkshire Bank said that one in ten people still keep their savings under their mattress or in a jar rather than in a savings account (potentially missing out on nearly £2 billion in interest). The bank estimates that if people who have the average £316.15 left in their current account switched it to a savings account, they could benefit from an extra £88.56 in 12 months’ interest. This figure seems low to me because I have a memory of someone saying at a conference — but a quick hard disk search can’t reveal which one — that interest foregone on current accounts represents more than £5 billion in income for the largest UK banks. Either way, it seems that a rash of products targeting cash replacement is on the horizon.