Brits building cash safety net amid economic uncertainty

Continuing global uncertainty has led to many households hoarding physical cash in their homes.

The Bank of England (BoE) has recently seen an increase in the number of banknotes currently circulating, despite a significant drop in the number of cash transactions.

Victoria Cleland, the BoE’s chief cashier, believes this is because many people want to have a safety net in place at a time of economic uncertainty.

This also comes after several high-profile cyber-attacks on businesses, as well as a power outage in Spain and Portugal that led to bank and payment systems going down.

People want to be ready for crisis

“At a time of uncertainty, at a time of crisis, people do move to cash,” Ms Cleland said.

“They want to make sure they have literally got something under the mattress.

“Even in the UK, there will be times where networks are down and you can only be paying in cash.”

Ms Cleland also pointed out that households struggling with the cost of living are also increasingly turning to cash, as it helps them keep on top of their budget.

Could shops be forced to accept cash?

The increased hoarding of cash comes amid a debate about cash acceptance across the country.

Businesses aren’t currently required by law to accept physical notes and coins.

But according to the Treasury Committee, this means they can refuse cash with no legal duty to accommodate people’s varying needs.

The group of MPs has called on the government to improve the monitoring and reporting of cash acceptance across the country.

Otherwise, it believes this risks “creating a two-tier system where vulnerable groups become excluded from community spaces such as leisure centres, theatres and public transport”.

So far, the government has ruled out requiring shops and service providers to accept physical notes and coins.