In the News

Cost of Living Crisis - People Turning Back to Cash as Prices Rise

Vicki Woolven

8th August 2022

After a trend of moving towards a cashless society, research conducted by the Post Office reveals that many people are going back to cash to keep tighter control on their spending, as living costs soar.

In July, post offices across the UK handled £801m in personal cash withdrawals, the most since records began five years ago, and up more than 20% from a year earlier. It is only the second time that personal cash withdrawals have exceeded £800m, with more people turning to cash to help manage their budgets on a week-by-week and often a day-by-day basis.Martin Kearsley, banking director at the Post Office, said: "We're seeing more and more people increasingly reliant on cash as the tried and tested way to manage a budget, and that the figures showed Britain is "anything but a cashless society".

The Cash Action Group says this is evidence that people are "literally counting the pennies" as they struggle with soaring prices. Prices are currently rising faster than they have for 40 years, and the increase in the cost of living is putting a squeeze on people's finances, as incomes fail to keep up. A spokesperson for the group said "People will be taking out cash and physically putting it into pots, saying 'this is what I have for bills, this is what I have for food, and this is what's left'."

"It helps people budget, as using cash means you literally can count the pennies. We all know that if you pay with a card, it's so easy to spend money you don't have and then go overdrawn. "If you've only got £30 to last you the week, holding that in notes and coins is still the most effective way of budgeting and controlling how much you spend."

With more high street banks closing branches, there's a huge need for post offices to allow people to get the cash that they need, especially for vulnerable or elderly people or those who don't have access to digital banking.

Read the full story here - https://www.bbc.co.uk/news/bus...

Vicki Woolven

Vicki Woolven is Subject Lead for Key Stage 4 Humanities at tutor2u. Vicki previously worked as a Head of Geography and Sociology for many years, and has been a content writer, senior examiner and local authority Key Practitioner for Humanities.

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