IS A CASH REVIVAL ON THE CARDS? What to consider when spending with cash

Today, it has been announced that Post Offices handled £1.03 billion in business cash deposits in August, the highest amount recorded so far this year.

On top of this, £2.9 billion was deposited and withdrawn by personal and business customers in August – the highest ever amount in a single month.

The news also comes as popular holiday spots recorded a 7.5% year-on-rise in cash withdrawals between January and July, according to Notemachine.

James Andrews, senior personal finance expert at money.co.uk said: “While it’s too soon to label this as a cash revival, with holidays in the UK currently on the rise and post offices doing the work of bank branches that have closed, there are definitely signs of a something of a mini-boom in cash use.

“It looks like August’s rise is the result of millions of holidaymakers heading to the British countryside and coast – rather than hopping onto a plane. That becomes especially likely given many of the smaller shops, restaurants, bars, local markets and souvenir stalls aren’t set up to accept contactless payments, or possibly can’t enable them at all in parts of the country with poor mobile reception.

“But while it’s certainly simpler to head out on holiday without having to change currency, there are still several things to be aware of.

“The advantage of using cash is that it can be easier to budget and keep a close eye on what you spend when you’re out and about. As well as this, you’ll never be charged fees for using cash and it’s impossible to have your card copied or cloned.

“However, if you carry a lot of cash around with you, you could be at risk from theft or even just losing your money. There are also no rewards attached to your cash spending, unlike certain credit cards that offer things like air miles or cashback.

“Making larger purchases using a credit card also provides added protection, with the card provider jointly liable with the retailer when something costs between £100 and £30,000. That means if something does go wrong, and you can’t get hold of the seller, you can make a claim against your card company instead.

“For more information about the pros and cons of cash spending, be sure to visit money.co.uk’s comprehensive guide here: https://www.money.co.uk/current-accounts/is-it-time-to-ditch-your-cash.htm”

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