Figures checked on 28 September 2026. Payment statistics come from UK Finance's UK Payment Markets 2026 report (published 19 August 2026, covering 2025) unless stated otherwise.

ClearScore is a credit broker, not a lender.

People in the UK made 3.9 billion cash payments in 2025, down from 4.3 billion in 2024. Cash made up 8% of the 49.7 billion payments made that year, according to UK Finance's UK Payment Markets 2026 summary.

UK Finance notes that cash has been in long-term decline. It also says that "for some the use of cash continues to be an important element of how they manage their finances."

UK Finance forecasts that cash payments will keep falling, to around 2.1 billion by 2035, or about 4% of all payments. It says the rate of decline has slowed as cash use becomes concentrated among people with a strong preference for cash, and in situations where cash has advantages over other payment methods.

How people are paying instead

UK Finance reports that 39% of all UK payments in 2025 were contactless (19.2 billion payments), up from 3% in 2015. Debit cards were used for 54% of all payments in 2025.

In June 2026, contactless accounted for 67% of credit card and 76% of debit card transactions. There were 1.57 billion contactless card transactions worth £26 billion that month, according to UK Finance's Card Spending Update for June 2026. That works out at an average of about £16.56 per contactless transaction.

Access to cash

The Post Office reports cash use at its branches through its quarterly Post Office Cash Tracker. In its release for the first quarter of 2026 (published 29 April 2026), it said 39.8 million cash withdrawals and deposits were made at branches between January and March 2026. That was 2% more than a year earlier and the highest first quarter on record. The Post Office says it has partnerships with more than 30 banks, building societies and credit unions, which let 99% of UK bank customers access their accounts at a branch.

Since 18 September 2024, FCA access to cash rules made under the Financial Services and Markets Act 2023 have required designated banks and building societies to assess the local impact when cash services such as branches or ATMs are due to close. Where they find significant gaps, they must provide reasonable additional services. LINK carries out these assessments and can recommend services such as shared banking hubs. LINK reports that 283 banking hubs had been recommended as of 23 September 2026.

Does spending in cash save you money?

There isn't a single answer, but research suggests the way you pay can affect how much you are willing to spend. In a US study published in 2001, Prelec and Simester found that people were willing to pay more, in some cases up to 100% more, when told to pay by credit card rather than cash.

Some people use cash as a budgeting tool. They take out a set amount for the week and spend only what they have in hand, so they can see how much is left. This has limits. Many transactions, such as online shopping, some public transport and bills, can only be made by card or bank transfer, so a cash-only budget may not cover all spending.

Some people instead use a separate bank account for day-to-day spending and pay a set amount into it each month.

Cash spending isn't recorded on your credit report. Credit reference agencies collect information used to compile your credit report and calculate their own credit scores. Credit history is built through credit accounts, such as credit cards and loans, being managed and repaid on time. Paying only in cash doesn't add to your credit history. Experian notes that people who have never had credit are likely to have a low credit score.

Note that lenders use their own scoring methods and lending criteria, so their assessments can differ from the score you see from a credit reference agency.

This article is for general information and isn't financial advice.

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