MAGGIE PAGANO: Cash is still king, right? Wrong

If you have heard reports of a rather sweaty woman in gym gear running around the streets of Saffron Walden brandishing a crisp £50 note and cursing under her breath, that was me.

After the gym, I had stopped off at the health food shop to stock up on a few things, giving the assistant the £50 tucked into my leggings.

The assistant refused my money. But surely it’s legal tender, I cry, you can’t refuse it. She doesn’t budge, saying that head office has told them not to take £50 notes because of fakes.

Off I went to the butcher’s shop opposite, where I know the staff, asking if they could break the note. Same again, no £50 notes, but they suggested going to a bank.

Not such a bad idea. But my bank, Barclays, closed long ago and now there are only two left in town.

So I ran to Nationwide, where there was a long queue. Explaining the problem, I asked the waiting customers if I could ask the cashier if he would change it. They all said yes, of course. One gentleman took one look at my Queen’s headed note, saying with great confidence that it wasn’t a fake. That felt like a small victory. There was so much chatter the cashier stepped out to take a look at the offending note.

Counting the cost: Cash made up just 9 per cent of payments last year, compared to being used for half of all transactions a decade ago

He agreed that it’s not a fake. Yeah, another victory. ‘But are you a Nationwide customer?’ he asked. It felt like a trick question, and it was. Nationwide does not change money if you are not a customer.

As you can imagine, by then I was ready to raise an Essex peasants’ revolt against shops that don’t take money and banks that don’t change banknotes. As luck would have it, one of the kind ladies in the queue opened her wallet, checked her cash, and offered to change my £50.

My first call is to the Bank of England. Can vendors refuse to take cash? Yes, says the press officer, they can. Even though cash is legal tender, it’s a concept which has a narrow technical definition in law – to do with contracts – and no one is obliged to accept it in exchange for goods.

Why, though, is cash usage shrinking so fast? Is it because vendors find cash so messy to deal with? Or are business owners being forced by the payment giants to go digital so they can charge them more? Or do most people simply prefer using cards or increasingly, mobile payments apps? Chicken and egg, probably.

Whatever the reason, cash is under the kibosh. It made up just 9 per cent of payments last year, compared to being used for half of all transactions a decade ago.

It is predicted to fall to 4 per cent over the next ten years. Yet here’s the thing: what happens in emergencies?

Imagine if a cyber hack or indeed, cyber warfare, brings down the banks? Or if there are blackouts, as happened in Spain and Portugal recently? Or other crises, such as another lockdown or war?

Being resilient is why countries such as Norway, Sweden and the Netherlands have warned their citizens to always keep cash in reserve. They are also introducing new legislation ensuring vendors must accept cash.

The European Central Bank is also alert to the dangers.

All households have been advised by the ECB to store cash at home in case of digital systems failing, as they will.

In contrast, the Bank of England does not have the mandate to give such warnings – that’s up to the Government.

Interesting, though, that its Governor, Andrew Bailey, told a recent Citizens’ Panel in Wolverhampton, that he always carries cash with him in case of emergencies. Does that include any £50 notes, I wonder?