In the midst of a digital payments revolution it is all too easy to discount physical notes and coins as being an historic artefact with no place in today’s payment mix. However, despite a 38% week on week decrease in the use of the UK’s ATM’s (2019 vs 2021) the Financial Conduct Authority state that around 2.4 million of Britons still rely on cash to a large extent in their day to day life.

Data: LINK & Graphic: Northey Point

Balancing the supply of and access to cash in the midst of a digital payments revolution is becoming a real issue for banks and ATM providers. Adding ‘free in credit’ banking that most of us benefit from, the closure of bank branches and the reduced availability of ‘free to use’ ATMs into the mix makes the future supply of cash a significant challenge that demands innovative solutions.

Whilst there is a real danger in preserving cash for cash sake – which, ultimately, will only serve to leave people behind in an increasingly digital society- the continued availability of cash (and the ability to spend it) is an important facet of the provision of payment options.

With bank branches closing at a rate of 50 per month since 2015 (source: Which?) and ATM’s reducing from 71,000 in 2015 to 54,000 in 2020 the traditional way of obtaining cash is disappearing fast for many who want to use cash. Over the next few years the ‘cash acquisition challenge’ will be compounded by an anticipated acceleration of physical bank branch closures.

Rather than shore up the fading model of cash acquisition, the UK is beginning to see innovative solutions that both protect and enhance obtaining cash for those that continue to want to use cash as a payment method.

Enter the lottery terminal

One company, Sonect, has launched an smartphone app and is trialling a cash acquisition scheme in Burslem and Stoke on Trent and is reporting that hundreds of people have already signed up for the service.

Using the same technology that retailers use to pay out lottery winnings the ‘click and collect, app is designed to allow you to ‘order’ your money and collect it without any charges being levied when you pick up a pint of milk or litre of petrol.

Source: This Is Money

The adoption of Sonect has improved the convenience of cash acquisition and is ensuring that cash is circulating in the local community without charges being levied in the process. Based on a lottery terminal solution a convince store owner in one town said:

This lottery terminal solution sounds like a no-brainer to me – I already know my customers would love the speed and convenience of getting some cash at the same time as their lottery tickets.

A simple idea like this would be perfect for guaranteeing a free access to cash solution in the UK

Interestingly, 95% of the UK population live within one mile of a lottery terminal and 95.6% of the UK population are currently within 1.2 miles of a cash access point.

Noting that the solution requires the use of modern lottery terminals Ron Delnevo the UK director of Sonect said:

In the UK we’re under-utilising the potential of modern lottery terminals to provide a wide-range of services to customers of community retailers.

The terminals can become a vital convenient local touch-point for access to cash, and other services the public have a right to expect on their doorsteps.

We really need to seize this technical innovation opportunity in the UK to support all the local needs of the public and the retailers who serve them and, critically, to solve the huge access to cash crisis

Simplicity is key

Key to success will be acceptance and simplicity.

Acceptance will be proven post the Black Country trial if we see stores from across the UK participating in the scheme. The app clearly shows retailers that are part of the scheme.

Simplicity seems to already have been proven through the trial. The Sonect app allows money to be stored securely in a digital wallet, which can be topped up in less than a minute using a debit card, credit card, Apple Pay or Google Pay.

In the UK, cash can be withdrawn through the Sonect app on a smartphone with no charge. Customer will only need to:

  1. Find the nearest participating retailer
  2. Select the amount to withdraw
  3. Confirm the withdrawal – even before leaving home, if they wish
  4. Show the barcode on the app at the till of their chosen retailer and receive their cash