Give Cash a Great Big Hug!

My love affair with cash started with my parents.

I was born in the 1950s, entering the world just as the UK was finally leaving World War 2 rationing behind.

In those far off days, there was plenty of poverty – but little debt. The financial system really didn’t allow the general public to have significant debt.

Personal loans from a bank or building society were almost unheard of. You could get a mortgage for a property but the average person – the man and woman in the street – would never have dreamt of asking for a loan to fund the purchase of a household item or pay for a holiday. Just as well: the request would not have been granted by their bank manager!

Bank managers were scary people for most of the rest of the society. They were the pillars of their community, with an almost god-like status. They had the key to the safe and would only turn it for a VERY good reason.

Bank managers had personal gravitas, aided by the dramatic settings of wood-panelled offices and chairs which were always a few inches higher than their customers. You had to look up to them, both spiritually and literally.

So, when my mum and dad opened their shop in 1958, aided by a loan from the property builder, cash was not simply “King”. For the public, cash had a monopolistic hold on both their wallets and their imaginations.

You were paid in cash and you made your payments in cash. A simple life.

Yes. There were cheques and a scheme called Hire Purchase – where you would pay in instalments and only actually own the purchase when the last one was paid – but when you used either of these payment methods, you knew the seller was basically doing you a favour, because you really didn’t have cash!

If you are wondering about cards, the credit variety didn’t emerge from plastic laboratories until nearly a decade after my parents’ shop had its far-from-grand opening. Not that such innovation changed anything in that small shop in Edinburgh. I don’t recall a card ever being used for payment in our family business. Using a credit card was considered to be shabby. You only did it if you had no money – cash – and basically were dismissed as someone who couldn’t pay their own way.

This all sounds incredible today, but that’s the way it was, folks!

I might add that plastic itself was viewed with disdain. If you really wanted to shame anyone’s purchase, all you had to say was, “That thing is only plastic. Probably made in Hong Kong!” to leave them without a vestige of self-esteem.

So almost everybody used cash for almost everything imaginable.

Shopkeepers, some of whom today seem to spend all their time bemoaning the supposed inconvenience of our national currency, loved cash.

I remember vividly my dad counting his “takings”, proud to see them increase as his shop prospered. Cash was both a badge of honour and a tangible measure of success for anyone in business in those days.

My father’s love affair with cash didn’t end with counting it. He always carried banknotes in his pocket – no wallet needed – and spent them liberally.

For me, the introduction to cash for my own use was the Half Crown (12.5p in today’s money) pocket-money dad left on the mantelpiece for me every Saturday morning at 7am, before he headed off to work.

I was a patient sort in those days – nothing changes – so at 7.05 am I would leap from my bed, gather my new-found wealth from the mantelpiece and cycle to the local shop where I bought my comics. Dad’s generosity opened up new worlds for me, worlds of superheroes and robot-fighters, of heroes and villains, of incredulous wonder and spectacular fantasy, worlds that could only be reached via bridges built by my beloved cash.

The years have flown past. The UK is a very different place today – and not simply because it is enduring the globally shared suffering of the current pandemic.

Cash use in the UK has certainly fallen, with card and mobile payment solutions capturing both massive marketing budgets and the public imagination.

However, when the final statistics are processed, we will still find that in 2019 consumers in the UK spent in the region of £170 Billion in cash – that’s not far short of £3000 for every woman, man and child in the country.

So, a little down but definitely not out. The idea of the UK becoming a so-called “cashless society” remains almost as unthinkable today as it would have done to my parents’ generation 50 years ago.

Around the planet, cash remains the most popular payment method for the public. The World Bank tells us that over 80% of payments worldwide are still made using cash – but, to be honest, even if that percentage declines in future years, it will remain remarkable.

I have a coin that was minted 2,500 years ago. What other product is there known to mankind that has had such an enduring history, along with a massive relevance to the way most of us live our lives today?

None. 

All of this makes it hardly surprising that cash has increased significantly as a tool in humanitarian aid over the last 15 years or so. Why wouldn’t it do so, given the right circumstances, considering that cash is what most of the planet use to help them live their lives each day. The humanitarian aid sector is now giving aid recipients something they already use and love. Cash.

That said, the figures can still be fairly described as startling. Back in 2004, when The Cash Learning Partnership (CaLP), was founded by 5 major charities, cash and voucher assistance (CVA) probably accounted for only around 5% of global humanitarian aid.

Today, that figure is within hailing distance of 40%, which in dollar terms means that each year around $5 Billion is being put into the welcoming hands of aid recipients.

There remain significant challenges in relation to improving both the quantity and the quality of CVA. CaLP is committed to working with members of its network to meeting those challenges to provide the best possible outcomes for those who need humanitarian support.

As the Chairman of CaLP, I plan to do everything in my power to ensure it meets all the challenges that lie ahead.

At a personal level, I will never lose the warmth I have for cash. For me, it is a bastion of personal freedom and choice, a security blanket to protect against societal or system disruptions and a store of value to allow savings for a rainy day (and it often rains in the UK!)

So I fully embrace cash, figuratively giving my favourite payment method a constant big loving and protective hug, pledged to maintain it on the world’s Payment Choice Menu, for all who want to use it.

I know many people around the world share my feelings for cash – and indeed for ATMs, which are the main delivery channel for currency in most countries.

I treasure the photograph below of the local people in Cidade de Deus, Rio de Janeiro, welcoming the first ATM ever to be installed in their Favela. Never mind figurative hugs, they turned out to give the machine the warmth of a Brazilian community “love-in”. They were proud that the ATM operators Tecban had chosen their neighbourhood as a site for the ATM and absolutely delighted to finally have convenient access to the cash they need to get through each day.

We can all surely learn a lesson from that South American community.

Love cash. Embrace cash. Never let anyone take away our right to use cash.

What applies to humanitarian aid, holds true for everyone on the planet.

Cash has been helping the public everywhere for 2500 years. It does so today. Woe betide us all if we allow tomorrow to dawn without it.