If you have heard reports of a rather sweaty woman in gym gear running around the streets of Saffron Walden brandishing a crisp £50 note and cursing under her breath, that was me.
After the gym, I had stopped off at the health food shop to stock up on a few things, handing the assistant the £50 tucked into my leggings. The assistant refused my money. “But surely it’s legal tender,” I cried, “you can’t refuse it.” She didn’t budge, explaining that head office had told them not to accept £50 notes because of counterfeit concerns.
Determined, I went to the butcher’s shop opposite, where I know the staff, asking if they could break the note. Same story—no £50 notes accepted. They suggested I go to a bank. Not such a bad idea, I thought.
However, my bank, Barclays, closed long ago and only two banks remain in town. I ran to Nationwide, where there was a long queue. Explaining my problem, I asked the waiting customers if I could ask the cashier to change the note. They all said yes, of course.
One gentleman took one look at my Queen’s-head note and confidently said it wasn’t fake. That felt like a small victory. The chatter in the queue caught the cashier’s attention, and he stepped out to examine the note himself. He agreed—it was genuine. Another victory!
“But are you a Nationwide customer?” he asked. It felt like a trick question—and it was. Nationwide does not change money if you are not a customer.
By then, I was ready to raise an Essex peasants’ revolt against shops that don’t take money and banks that don’t change banknotes. As luck would have it, one of the kind ladies in the queue opened her wallet, checked her cash, and offered to change my £50.
My first call was to the Bank of England.
**Can vendors refuse to take cash?**
Yes, says the press officer—they can. Even though cash is legal tender, the concept has a narrow, technical legal definition related to contracts. No one is obliged to accept cash in exchange for goods.
**So why is cash usage shrinking so fast?**
Is it because vendors find cash messy to deal with? Are business owners being pushed by payment giants to go digital so they can be charged more? Or do most people simply prefer using cards or, increasingly, mobile payment apps? It’s probably a chicken-and-egg situation.
Whatever the reason, cash is under the kibosh. It made up just 9% of payments last year, compared to nearly half of all transactions a decade ago. It’s predicted to fall to 4% over the next ten years.
**But what happens in emergencies?**
Imagine a cyber hack or cyber warfare brings down banks. Or there are blackouts, like those recently experienced in Spain and Portugal. Or other crises such as another lockdown or war.
Being resilient is why countries such as Norway, Sweden, and the Netherlands have warned their citizens to always keep cash in reserve. They’re also introducing legislation ensuring vendors must accept cash.
The European Central Bank is alert to these dangers as well. All households have been advised to store cash at home in case digital systems fail—as they inevitably will.
In contrast, the Bank of England does not have the mandate to issue such warnings; that responsibility lies with the Government. Interestingly, its Governor, Andrew Bailey, told a recent Citizens’ Panel in Wolverhampton that he always carries cash with him in case of emergencies.
Does that include any £50 notes, I wonder?
https://www.thisismoney.co.uk/money/comment/article-15164391/MAGGIE-PAGANO-Cash-king-right-Wrong.html?ns_mchannel=rss&ns_campaign=1490&ito=1490