How payments have changed during the Queen's reign
By UK CreditCards.com
With her Diamond Jubilee tour this summer, Queen Elizabeth II celebrates 60 years as monarch. A lot has changed since she took the throne -- and, with that in mind, researchers at Lloyds TSB have pulled together some facts and figures that show just how much the payments landscape has progressed. Here are some of the highlights.
1952 and the rise of the cheque
When the Queen's reign started, the only methods of payment in the UK were cash and cheques. Debit and credit cards simply did not exist, and the idea of mobile payments was inconceivable. Cheques became increasingly popular as the Queen's reign continued, with the volume increasing 12-fold between 1952 and 1990, before starting a steady decline that would soon lead to their near abolition.
The plastic revolution
When plastic cards came on the scene in 1966, they rapidly changed the way we pay for goods and services. Consumers no longer had to carry a purse full of cash or take the time to write a cheque. Credit cards also opened up a new and convenient method of unsecured borrowing, enabling shoppers to pay off their debts at a controlled rate of interest over an extended period of time. In 1987, the credit card's partner in plastic, the debit card, was introduced.
By 2001, half of all retail spending was on plastic. Today, around 95% of people now own a debit or credit card, showing just how much this method of payment has taken over.
Technology set to mould the future of payments
Like cheques before it, plastic has an uncertain future, due to the latest revolution in payments. Thanks to advances in technology and the increasing affordability of computers and smartphones, banks and card providers are coming up with ever more inventive ways to pay. Contactless card readers are now becoming a common sight, enabling consumers to complete transactions with a simple tap of their contactless-enabled debit or credit card. Those with near-field communication (NFC)-enabled smartphones can even use their mobile handsets to pay in this way.
Smartphones are thought by many to represent the future of payments, as they could replace your wallet in the future. Not only can they be used in place of a contactless card, but smartphones can be loaded with gift vouchers from different retailers, meaning you don't have to load down your pockets with plastic cards and coupons.
In addition, it is now possible to get vouchers sent directly to your phone that offer savings at nearby shops and restaurants. With the ability to check your bank and credit card accounts via your smartphone, as well as complete transactions, it may soon be the case that your mobile phone is all you will need to take when you leave the house.
Cash remains king -- for now
Payment methods have changed dramatically over the past 60 years, with the rise and fall of the cheque, the plastic card revolution and the growth of contactless and mobile payments. But cash has remained resilient throughout. Consumers and businesses are constantly looking for quicker and more convenient ways to pay, but there is no denying that cash has held its own. Around 21 billion payments were made in cash in 2009, accounting for two-thirds of all transactions.
However, in terms of the overall value of transactions, cash is definitely in decline. Around three-quarters of cash transactions are for values below £10, and cash now accounts for just 23% of all consumer payments in value terms.
Still, the importance of cash is still recognised and banks are looking to innovate in this area as well. In June 2012, for example, NatWest launched its new emergency cash initiative, which enables people to withdraw money from an ATM with the aid of a smartphone app if they find themselves out and about without their debit card.
From cheques and cash to an array of apps, the payment possibilities have exploded in the past six decades.
"No doubt we will continue to see substantial changes in the way we make payments over the coming years, as we have seen over the past 60 years," said Lloyds TSB Spokesman Jatin Patel in a statement.
Published: 20 June 2012
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