It’s a confusing time for shoppers. More retailers are refusing to take cash, while a minority still prefer it. Some shops have a minimum spend for card payments while others will take cash, but are unable to give change.
These puzzles are playing out on high streets across the country as details on new legislation to protect access to cash are set to be announced within the next fortnight.
My home town of Berkhamsted in Hertfordshire is a case in point. Just a few minutes’ walk from the railway station is a cluster of shops leading up to the high street.
Visitors to the first shop, a branch of ready meals retailer Cook, are greeted by the sign: ‘Card payments only please – we’re no longer accepting cash payments.’
Divide: Art shop owner Jo Kidd prefers ‘real money’, but other stores don’t
Across the road from Cook is the family run Berkhamsted Arts and Crafts shop. Above the till is a poster reading: ‘Real money makes us smile – we ALWAYS prefer real money.’
The explanation underneath is clear: ‘It [cash] helps us stay in business because less of what you spend disappears in bank and card fees.’
So which approach is right? In Berkhamsted, like in many other towns, retailers are choosing whether to continue accepting cash or go down the card-only route, which became far more commonplace during the pandemic.
Berkhamsted has had a market since Saxon times and owes its prosperity to more than a thousand years of trade on its bustling high street. Independent shops stand side-by-side with nationwide chains such as Boots, WHSmith and Costa Coffee, making it a popular destination for shoppers as well as tourists.
Berkhamsted Arts & Crafts was founded by owner Jo Kidd’s parents 50 years ago, and her husband Laz painted the ‘Real money makes us smile’ poster for the shop.
She says: ‘We encourage people to spend cash where they can. Our products are all under £30 and it hurts a bit if people produce a card to pay for a 20 pence piece of card, due to the commission we’re charged by the card machine supplier.
Our products are all under £30 and it hurts a bit if people produce a card to pay for a 20 pence piece of card, due to the commission we’re charged
‘It’s only pennies but it all adds up.’ The other advantage of cash, says Jo, is that she doesn’t have to wait two or three days for the money to come through, which can affect cash flow.
Ready meals shop Cook says it moved to card payments as a result of the pandemic. Local bank closures also made banking cash difficult – it has had to change banks twice recently. Barclays, Santander and Lloyds closed branches, leaving just HSBC and NatWest in town.
‘Our stance on payments is always under review, but so long as there are no customer issues, we’re happy to be card only,’ it says.
Next door to the arts shop is The Refill Pantry, a packaging-free organic retailer which opened in October last year. ‘For the first month we tried just accepting cards, but quite a few of our older customers were upset about it,’ says owner Celina Mendoza, who also has a branch in nearby St Albans.
‘Cash takes a lot of work counting daily and banking weekly, but our shops – where people weigh things out – are set up like how people used to shop and customers paid in cash.
‘Now, around 10 per cent of customers use cash while the rest use cards. So I’m glad we changed. Children even come in with their £2 pocket money to spend in store which is lovely.’
Cash or card? Exclusively accepting card payments means retailers don’t have to spend hours each week counting cash – but the move can also alienate potential customers
Mendoza’s customers are far from alone. Around 5.4million adults rely on cash in their daily lives.
Dave Walden, co-owner of Berkhamsted Sports, says: ‘As a retailer, it’s getting harder to pay cash into local banks. I either bank cash takings at the Post Office, or we use the cash to pay ourselves and declare it in the usual way.
‘But, for bigger companies who are used to paying in money every day, the local bank closures are a pain.’
Pete Elsworth, chair of Berkhamsted & District Chamber of Commerce, says that a number of businesses that went card-only during the pandemic have since reversed their decision.
‘A lot of elderly people prefer to use cash and some people just don’t have cards,’ he says. ‘One or two bakers are card-only and are losing custom.’
The Highwayman pub is one place that has stuck with its card-only policy, although ironically its weekly pub quiz costs £2 cash to enter. Mark Derry, chief executive of parent company Brasserie Blanc, says that its 32-strong pub estate is now cash-free.
‘Even before lockdown, 90 per cent of transactions were card anyway, and the consequence of not taking cash means we don’t spend hours counting it. We’re short of staff, so anything that saves time is helpful.’
One of the newest businesses in town, Daisy and Co restaurant, is also card only. Senior supervisor Laura Johnson says that following Covid, ‘no one really carries cash anymore, so this is the way it’s going’.
The restaurant will accept cash if customers really haven’t got any other way of paying, or staff have been known to put payments through on their own cards in exchange for the correct cash.
Just paying up after lunch at Daisy and Co are friends Gill Goss from Berkhamsted and Christine Trigg from Gloucestershire, firmly on opposite sides of the debate.
Gill says: ‘I use my card all the time and I have to go to the Post Office to get 20 one-pound coins because I haven’t got the cash for buying raffle tickets at The Women’s Institute.’
‘I’m a cash person,’ says Christine firmly. ‘With cash, I know what I’m spending. If I’ve drawn out £100, then I know when it has gone.’