Tuesday, 25 September 2018

Cashing up

A Suffolk pub has claimed to be the first in Britain to go entirely cashless and stop accepting any payments in cash. This seems to be a rather dubious assertion, as I know that Sandbar in Manchester has been entirely cashless for some time, and Martin Taylor has recently encountered the same in the Cloudwater brewery tap. However, it’s undoubtedly a trend that is only going to grow.

It needs to be made clear we are not discussing cashless payments per se. They are a growing feature of the financial landscape, and obviously it makes business sense for many pubs to accept them. But to refuse to accept cash entirely is something entirely different, and comes across very much as an attempt to practice social selection of your clientele.

This may not be a problem in a rural gastropub, but in inner-city boozers it’s a common sight to see the pound coins being counted out on to the bar to pay for a pint. It is estimated that there are 1.6 million unbanked workers in the UK, and there must be many more pensioners and benefit claimants, not to mention people who prefer to avoid using cards for routine transactions. It’s effectively saying that you’re not interested in the business of the poor or the old. And it seems particularly ironic that it is being practiced by a standard-bearer of the craft beer movement that supposedly prides itself on its “inclusiveness”.

There are other reasons to justify caution in adopting cashless payments, some of which are set out in this Guardian article and this blogpost by Boozy Procrastinator. One obvious point is that they make budgeting more difficult, both in terms of controlling your spending on a night out, and also in a more general sense of creating a disconnect with the whole concept of money. It’s hardly surprising that so many people seem to get into unmanageable debt when they hardly ever see the stuff.

You are making yourself vulnerable to power cuts and to the breakdowns of banking computer systems which seem all too common nowadays. You are also willingly putting yourself in the hands of giant, faceless corporations that may not have your best interests at heart. And someone is able to track exactly where you have been and what you have spent your money on. You don’t have to be a tinfoil hatter to see how that could potentially be abused.

Yes, by all means use cashless payments where they are convenient, and allow them in your pubs, but there are dangers in the headlong rush to embrace them and relegate cash to history. And, if you really want to be a rebel, stick to cash as much as you can.

26 comments:

  1. There's always the other issue where cashless sorta stops working when the electricity does. Or when VISA and MasterCard decide that they don't want to work and the Amex alternative is so darn expensive no-one wants to take them...

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  2. "craft beer movement that supposedly prides itself on its “inclusiveness” "

    Not entirely sure what the scene is like back home in the UK, but here in central Virginia the craft beer scene is so painfully far from inclusive, unless by "inclusive" you mean white, middle to upper middle class, college educated, socially liberal folks who love nothing more than patting themselves on their collective backs for how socially minded they all are. Perhaps the term "champagne socialist" should be replaced with "craft beer socialist"?

    I realise there a large dose of irony in that statement as I tick every box of the definition, minus the self congratulation.

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    1. That's exactly what I mean - see this blogpost. It's quite laughable how so many crafties live in an elitist bubble and yet genuinely believe that they are oh-so-inclusive. I was blocked by one person on Twitter for suggesting it wasn't really very inclusive to refer to people as "gammon".

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    2. I suppose that "inclusiveness" means different things to different people, and for sure, there are some who make a point only of including those whom - they assert - others would not. No, this gammon v. snowflake lark is a bit tired now too.

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  3. I am surprised that it is legal to refuse to accept "legal tender" in payment of a debt. I wonder what would happen if you bought a pint, took a deep swallow, and then found that you did not have a card to pay with and offered cash instead?

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    1. I'm sure we've had a discussion before about how the concept of "legal tender" is narrower than often supposed. But my understanding is that they would be obliged to accept cash, but there is no requirement to provide change.

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    2. Bank of England web site says "In England and Wales, legal tender is Royal Mint coins and Bank of England notes"

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  4. One interesting consequence of an entirely cashless society - and a consequence that would be eminently desirable to both government and business - is that central banks would be able to set negative interest rates to encourage spending over saving

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    1. I'd agree. Negative interest rates is why the BofE would like a cashless society. It would be difficult in practice even if cash was abolished. You can always buy gold coins. Inflating the currency has the same effect as negative interest rates and seems to provoke less reaction among savers so why attempt something that would provoke such a backlash?

      To an extent we are already cashless. Government money laundering rules require registration to accept more that £10k in cash payment. Most people would not try to buy a £20k car from a dealer with a case of notes.

      Cash is only a small amount of the money in circulation. Tokens for low value items. Like pints in pubs.

      As for excluding people, the legal right to a basic bank account has been around for a few years now so no one is not allowed a debit card.

      For those wanting to budget. A secondary "spends" account is your answer alongside app purchased £1.99 Bud Lights. A penny saved is a penny earned.

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    2. Inflation has the same effect on the spending power of savings as negative interest rates, but as you say, not on the minds of savers. I'd guess that its effect on their spending behaviour would accordingly not be the same either then. Whether there's still some benefit for the central banks, you'd have to ask that nice Mr. Carney.

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  5. This is an interesting topic and before I go any further I should state that I am completely opposed to a 'cash free' society...but...on my first visit to the Burning Soul Brewery there was a sign saying "Card Payments Only" which has now changed (on my second visit) and says "Card Payments Preferred".

    I can understand a micro brewery tap (that's only open for 11 hours a week) not wanting the hassle of dealing with it when the brewery side of the business doesn't require cash. The fact that they've changed the sign shows that there is still the demand from the public to use proper money, but it is a sad truth that cash is a hassle for many businesses - especially as banks charge them to pay cash into their own business accounts!

    Cash is freedom and if it disappears it will be one step closer to living in a totalitarian state where somebody knows exactly how much you spent and what you spent it on. (We're not that far away now, but we still have a bit of wriggle room left!)

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    1. And credit card companies charge a commission

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    2. The rate of commission depends on how well you negotiate with whichever bank is processing your payments, but in any case is less than 1%. Banks will charge more than that for paying in cash, so unless your business is spending cash, it is probably more cost effective to take payment by card.

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  6. Never mind the poor or the elderly. Cash-in-hand, tax-dodging white van man round our way wouldn't like that. He'd have to put the stuff in a bank. It'd a be a fair part of many pubs' trade lost on that one point alone, I dare say.

    It might have a future at student bars and the like, but I can't see it catching on generally, fortunately.

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    1. Curiously enough most of the younger white van men around here will not take cash. Unless they can show a decent trading bank account they have no chance of getting a mortgage.

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    2. Aye, that figures. Once they've got that, then maybe some change, but I do have sympathy. They don't get paid holidays or sick days after all. On your earlier point, a cashless society would make banking compulsory too. What would happen about kids' pocket money? We'd perhaps best not get started.

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    3. "What would happen about kids' pocket money?"

      Bitcoin? :D

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    4. When cashless payments were originally mooted many years ago, they were seen as an "electronic wallet" which you would top up from your own or someone else's bank account in a similar manner to a pay as you go mobile phone. This would answer some of the concerns about budgeting, anonymity and bringing the unbanked on board, but it doesn't seem to have gone that way.

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    5. Which reminds me - thank you Mudge - that I have a few quid rattling about on an old Oystercard. As for crypto assets like Bitcoin, they seem maybe to be in their death throes. Since their main use - apart from speculation - seems to be for criminal purposes, including financing the subversion of democracies across borders, I would warmly welcome their demise.

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  7. to be fair I dont think they are trying to get registered in the Guinness book of world records as being the absolute first to claim it,not that Id expect news of other pubs round the country doing the same would reach us out in the wilds of Suffolk anyway.

    But its a nice bit of promotion for a pub thats just recently reopened, that has this unusual hook to the story and a good news story (pub reopens for a change) thats been picked up even by the national newspapers, you cant pay literally with cash or cashless for publicity like that, and its a pub thats been shut for absolutely donkeys ages, whose nearest cash point I reckon is about 2.5-3miles away at least, now everyone knows they are open again

    I keep meaning to trek out there before the weather/nights close in much further, to see what its like, the landlord used to run/own the Brewery Tap (by Tolly Cobbolds former brewery) which closed, but we will see if it works, there used to be some really nice popular country pubs that did food out on the Shotley peninsula that all closed down for one reason or another, and I think locally people got out of the habit of eating out like that or using those pubs regularly, that market shifted either South towards Dedham or North to Woodbridge.

    as for the cashless thing in pubs generally, Im surprised how quickly thats caught on in some pubs in our area,I know one pub I visit didnt even accept card payments for 20 years, now they have cashless payments and Ive seen both card and even watch payments, for rounds big, small and even individual drinks, they keep a minimum payment of £5 though it says alot about prices now most can go just add a packet of crisps to a pint and be covered.

    I do often feel like Im one of the few left only paying with actual money anymore, and it must make a huge difference to the cashflow through the till, fortunately they keep a good float going still.

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  8. Whilst I'm totally in favour of keeping cash as a means of payment, I do have some sympathy for businesses for whom cash can be seen as a bit of a nuisance.

    Banks charge businesses for the "privilege" of paying in cash; something I remember only too well from the time when my wife and I had our own business. On the other hand, the credit card companies charge businesses for processing card payments, so if you run your own show, you get screwed either way.

    I see a number of previous correspondents have also made these points.

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  9. I've just had to email everyone coming on the walk to Torrside brewery on Saturday as part of the Bollington Walking Festival that it's a cash-only bar. Shocking :-)

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  10. "...And, if you really want to be a rebel, stick to cash as much as you can" says Mudge, and well he might. We all love that, don't we?

    That got me thinking and all. Here in God's Own County, we're spoilt for choice on stacks of stuff, and ways to feel a rebel are no exception. Why, there's everything, from not cleaning your car to within an inch of its life of a Saturday, to actually obeying the new 20mph limits; from wearing a hat when it's sunny, to carrying a brolly when it rains; buying your fish and chips from a shop that does not use dripping - you know which ones - to your wife's actually going to the bar and buying herself a drink, and one for you too....I could go on. What's it like round your way?

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  11. Here in Ireland the former Prime Minister Bertie Ahern was appearing before an investigative commission set up to investigate his past dubious financial dealings.
    Specifically the claim by his secretary that he kept €30,000 in cash in brown envelopes in his safe.
    Ahern claimed the cash was a " dig-out " from his mates.
    Asked why he kept so much cash Mr Ahern said he didn't have a bank account at the time.
    At the time he also happened to be Ireland's Finance Minister.
    I kid you not.

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  12. Th problem I have not paying cash is that Big Brother always know exactly where you are and what you are doing at every minute...

    Britain Beermat

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    1. The Stafford Mudgie4 October 2018 at 11:35

      Yes, and with my Oyster Card 'Big Brother' knows every journey I make on the Underground - and could probably plot the pubs I use between stations - but that doesn't concern me. Should it ?

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