Shoppers choosing cash rather than credit

Consumers are cutting back on their credit card spending and increasingly using cash to pay for their purchases, it has been claimed.

A survey of 17,000 shops conducted by the British Retail Consortium (BRC) revealed that cash was used for 60 per cent of transactions last year, up from 54 per cent in 2006.

The BRC said this shows people are concerned about spending money they do not have and want to keep tight control of their finances.

Another issue raised by the BRC is the cost that credit card companies charge retailers, which is four times the amount of a cash transaction.

Consumers are forced to pay for the extra charges as retailers pass them on through increased prices.

“There should be a lower fixed fee per transaction which actually reflects the cost of processing, so new technology brings balanced benefits to retailers, consumers and banks,” said BRC director general Stephen Robertson.

Savings expert at Scottish Widows, Anne Young, recently said that young people get into trouble due to the “proliferation of credit” that is now available to them, adding that more should be done to educate people on managing their credit.

Tags: Payment systems, Financial services, Business Finance, amount, online shopping, scottish widows, credit, young people

Online banking ‘good for all ages’

Online banking is for savers of all ages, according to a finance expert.

Nick Staib, a spokesperson for HSBC, said that age was no barrier to internet banking and revealed that internet banking was outstripping bank account sales.

UK payments association Apacs recently published figures that showed the number of adults using online banking had increased by 174 per cent from 6.2 million in 2001 to 17 million last year.

This figure included 350 per cent increase in use amongst the over 55s.

Mr Staib said that there was a steady growth in customers going online and added that while internet banking was readily adopted by young people, the older generations saw it as “natural” to bank online.

“There is no reason why people of any age can’t use the online banking, as long as they can send an email to somebody,” he said.

“If we didn’t [have internet access for banking] I don’t think we would be able to sell hardly any bank accounts at all.”

Tags: apacs, young people, access, number, finance expert, use