Money Makes the World Go Round

The most recent wave of bank branch closures has come as an unwelcome development to the many people and businesses who still  rely on them either for cash transactions or who prefer to conduct their business with a real person rather than a computer.

Continual change in how we do business is, in reality, the norm rather than the exception. To begin with there was barter, then coins usually made from some precious metal became a means of exchange, then paper money which is effectively a promissory note, was first issued by the Bank of England in 1695. Standardised denomination bank notes then appeared in 1745. Cheques as we know them today  date from 1717. An early from of travellers’ cheque was issued by the Knights Templar in the Middle  Ages whereby funds could be deposited in one place in return for a scroll redeemable elsewhere. These were coded to identify the bearer so any thief would face consequences far greater than having a card declined if he did not know the ‘PIN’ number!

The use of cash probably started to decline in the 1960s when the first charge cards like Diners and American Express appeared followed by credit cards a few years later. I have had one since I started work in the 1970s and now only use cash when unavoidable. Some readers will remember receiving their wages in cash, a toil for those of us who had to administer it as well as a security risk, thankfully replaced by cheques and then BACS transfer. Cost is also a factor with cash handling becoming significantly more expensive than electronic transfers – something not lost on the banks or on businesses with a high volume of transactions. I recall seeing estimates a few years ago that it was costing the Council over £1.00 to process a cash payment and about 30 pence for a cheque compared to only 3 pence for a direct debit. For 2015 the estimated total of electronic commerce was £533 billion putting the UK in the top three countries world wide. With online shopping becoming more popular and with more and more consumers choosing to use card or contactless payment the movement away from cash is inexorable. We can also pay our monthly card bills from the comfort of our own homes rather than take time queuing at the bank to hand over cash or buy stamps to send a cheque through the post.

Change is often unwelcome and at times we would all prefer to stay within our comfort zones but progress involves change. After all we don’t fill up the car in exchange for a sack of turnips!

First published in the Barnsley Chronicle - Penistone Living March 2018