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Cash still pays to cover household bills, pre-pandemic study finds

Bill payers are still invested in cash, with cash office payments taking preference over options such as PayPoint, Post Office, and Payzone according to pre-pandemic figures released by payment specialist allpay.

The survey outlined an ongoing decline in direct debit uptake and a continuing need for cash across the market. The pre-pandemic survey – insight into payment behaviours for UK household bills – took in more than 2,000 respondents UK-wide varying household status to find fewer people were fully confident in managing money and paying their household bills, with a year-on-year decline of 2% to just 78%.

The 2019-2020 stats show an ongoing decline in direct debit use as cash remaining a key focal method with a steady rise in bank transfer, credit card, and standing order payments over the past three years.

Monthly payments were the most popular frequency in all household bills, although the stat show payees have increased their preference in quarterly and four-weekly payments – quarterly instalments for Rent (61%) and Council Tax (50%) significantly increased year-on-year.

The findings reveal reduced consumer confidence over consecutive years in paying household bills – with the ongoing decline in the direct debit uptake and a continuing need for cash across the market. Respondents referenced ‘ease of use’ as the most common reason when choosing their payment method and nearly 1,000 respondents said that reminders via text or email would make paying their household bills easier.

2020 results demonstrated that 13.5% of rent payments alone were made utilising cash, with more than 75% of these made at business offices. The stats show direct debit is still the most popular payment type across all household bills, with an average take-up of 55%, though usage decreased by 5% across three years.

Rent payments registered the lowest share against all other bills (26%), with the most popular across Internet & Phone (70%) and Electricity & Gas (61%) bills. Debit card payments are the second most popular payment method, despite showing a small decline (5%) on average per bill from 2019.

Take-up for the second consecutive year is highest in both Rent and Insurance payments, with the use of credit cards the largest increase of all payment methods across the three years (2.2%). Monthly payments continue to be the most popular frequency in all household bills, although payees have increased their preference in quarterly and four-weekly payments.

Some 60% of cash rent payments were made via Post Office, Payzone, or PayPoint outlets.

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