Will shops and restaurants be forced to accept cash in the future? Deputies demand evidence to understand whether new rules are needed

MPs on the Treasury select committee are calling for evidence to determine whether new rules are needed to make accepting cash mandatory across the UK.

There are currently no rules requiring businesses – from shops to restaurants – to accept cash and the evidence will be used to establish the current status of cash acceptance in the UK.

It will look at whether businesses should always accept cash and how much it would cost.

Cash use has declined over the past decade as people primarily turn to contactless card payments.

The Treasury Select Committee said cash remained “a vital resource for many”.

“Research shows that using cash can be a vital lifeline for groups such as people with long-term poor health or people at risk of economic abuse,” it added.

According to non-profit company Cash Access UK, around 3.1 million people in the UK rely almost entirely on cash as a form of payment.

Around 1.5 million adults used cash as their main method of spending last year – the first increase since 2019, according to UK Finance.

It says this can be attributed to the cost of living crisis, with more people preferring cash to budget.

In 2022, only 900,000 people used coins and notes as their primary method of spending.

Overall, the use of cash fell last year to 12 percent of all payments – and the UK Treasury said 22 million adults “primarily use cash.”

According to the Bank of England, the decline in cash use increases the infrastructure costs of holding physical cash as a viable payment method, which could lead to disruption to businesses and consumers.

Others have highlighted the dangers of over-reliance on digital payments, suggesting that accepting cash should be seen as a form of civic preparedness.

There are currently no regulations requiring businesses to accept cash.

Adrian Roberts, chief executive of Link, told This is Money: “Our data consistently shows that people who rely on cash live in the poorest parts of the country. But more than that, they are also more likely to be digitally excluded.”

In June this year, the government gave the FCA new powers to ensure reasonable access to cash withdrawals and deposits.

Under the rules, banks and building societies must weigh whether local communities lack access to teller services such as branches and cash machines, and provide additional services where they find “significant gaps”.

The deadline for submitting evidence to the Treasury Select Committee is 5pm on 2 December.