Government outlines plan to curb digitisation of money
Posted on October 15, 2020 by Alistair Hardaker
Under a new government proposal, Brits would be able to get cashback from shops without needing to buy anything – a move it said would protect the UK’s cash system.
The government is seeking views on its approach to legislation first announced in its March budget to ‘protect access to cash’.
It said that while cash use is declining in favour of cards, mobile and e-wallets payments, it “remains crucial for groups across the UK – including the elderly and vulnerable”.
It will hear from consumer organisations, businesses, financial institutions, providers of ATM and payment services and others through a call for evidence.
One proposal under consideration is cashback without a purchase. The government said that many “find that cash is more accessible than digital payments methods or that it helps them to budget and manage their finances”.
According to the government, last year consumers received £3.8bn of cashback when paying for items at a till, making it the second most used method for withdrawing cash in the UK behind ATMs.
It said an uncited ‘current EU law’ was a barrier to widespread adoption of cashback without a purchase. The government is now considering scrapping these rules once the transition period ends on 31 December 2020.
John Glen, Economic Secretary to the Treasury, said: “We know that cash is still really important for consumers and businesses – that’s why we promised to legislate to protect access for everyone who needs it.
“We want to harness the same creative thinking that has driven innovation in digital payments to maintain the UK’s cash system and make sure people can easily access cash in their local area.”