A new survey released by the British Retail Consortium indicates the trend away from cash-based payments to electronic transactions is growing stronger in the U.K.
According to the study, cash payments in the U.K. fell by three percent over the past year and 10 percent over the past five years.
In 2013, debit card transactions comprised 50 percent of retail sales value—an 11 percent increase over the past five years—and debit payments, which according to the study are increasingly used for small-dollar purchases, represented approximately one-third of all transactions, a 30 percent increase over 2011.
Though electronic transactions are becoming increasingly popular, cash still reigns, accounting for approximately 53 percent of all retail transactions. The report said cash is still the most cost effective method for retailers to accept payment.
The total cost for retailers to process debit and credit cards, according to the study, is more than $1 billion per year—the report said interchange fees account for more than 90 percent of the cost.
“There is no meaningful explanation as to why cards are more expensive than cash, or why card fees increase annually – other than the commercial benefit of banks, at the expense of retailers and their customers,” the study said.
The consortium called on the U.K. government and regulatory authority to implement caps on interchange fees “for the immediate benefit of businesses and consumers.”