The other side of the virtual coin: does cashless economy exacerbate homelessness?

Earlier this year we wrote about the emerging effects of the growing cashless economy on homeless people in the UK and abroad. Recent media coverage and publicity given to tech-based innovations in this area prompted our interest and informed our initial research into this issue. What we found was that, to date, much of the public attention has been focussed on one specific group of homeless people affected by the cashless economy: homeless people who engage in street begging. This is not surprising. People who engage in street begging are highly visible to the public. Even though many may avert their eyes or pretend not to notice that man at the Tube station entrance or that woman outside of the local Tesco, everyone is aware of their presence. Moreover, it’s fairly easy to recognise how the growing cashless economy affects this group of homeless people: less cash means less spare change for street donations.

What’s less clear is how the cashless economy is affecting the greater majority of homeless people - those who don’t engage in street begging - as well as people who are at risk of becoming homeless. As we’re learning, the knowledge gap on this issue remains significant. The Access to Cash Review highlighted that “for 25 million people in Britain, or 47% of the population, living in a cashless society would present real challenges”. The review suggests that people who already experience a measure of financial, digital and/or social exclusion will be hit the hardest: rural and remote communities, people with physical and cognitive disabilities, people with mental health issues or suffering with compulsive behaviours like gambling, the unbanked and the homeless.

The top-line message from the Access to Cash Review is clear: the UK is not ready to go 100% cashless without leaving large parts of the population behind. But this transition is happening - and fast. News of cash machines closures is becoming a regular occurrence, while more and more businesses are choosing to go cashless. Yet, our understanding of how the cashless economy is affecting people’s lives on a daily basis, their experiences navigating and living in this brave new cashless world, is limited to general statistics and estimates.

The links between the cashless economy and homelessness are particularly unclear and merit deeper exploration. In our work on financial inclusion and financial capability we often encounter people who find themselves in moments of financial vulnerability and hardship that put them at risk of becoming homeless. We’ve also seen examples of how digital financial services can exacerbate this already vulnerable state. Our recent conversations with homeless charities highlighted further ways in which the cashless economy can pose safeguarding risks to some vulnerable people, such as LGBTQ+ youth or women experiencing domestic violence and abuse, increasing their risk of becoming homeless. But all these are mostly anecdotal observations of very unique and personal lived experiences that are affected by the expanding cashless economy.

How is the cashless economy impacting that daily lives of over 370,000 homeless people in the UK? How is it affecting those people who are at risk of becoming homeless?

These questions need to be explored by policymakers and service providers alike if we are to ensure that going cashless does not mean going homeless, not just for the most vulnerable but for anyone in our society.


Mindset reminder:

  • There’s a lack of understanding of how the cashless economy is affecting homeless people who do not engage in street begging and those at risk of becoming homeless;

  • Recent research suggests that the UK is not ready to go fully cashless without leaving behind some of the most vulnerable part of our society;

  • More insights are needed into the lived experiences of people who are or are at risk of becoming homeless to build a better understanding of how the cashless economy is impacting their day to day lives - and ultimately, how policymakers and service providers alike can ensure that going cashless does not mean going homeless for anyone.


Sofya Bourne