Almost half of adults now carry less than £10 in cash, as Britain moves towards becoming a cashless society.
More than one in ten people carry no cash at all – using a bank card for even the smallest transactions. Younger people are less likely to carry cash than their parents or grandparents, the study found.
Figures out earlier this week from the Payments Council found that card and automated payments have overtaken cash transactions for the first time.
However, many consumers are still reticent to use cards for small purchases. Around 60 per cent of people questioned by budgeting account provider thinkmoney said that they would not use a debit or credit card to buy something like a newspaper, a packet of crisps, or a pint of milk.
Older generations were also still far more likely to be carrying coins and notes than their younger counterparts. Some 41 per cent of those aged 18 to 24 said they had less than £5 on them in cash, which is double the amount of over-55s who carried an amount this small.
Just 6 per cent of 18- to 24-year-olds questioned said that they held more than £50 in cash, compared with almost three times as many over-55s.
The figures released by the Payments Council also showed the number of people using cash machines continues to grow year on year.
Ian Williams, for thinkmoney, said: “It’s really interesting to see that younger people are moving away from making cash payments.
“Paying for items on card means that you will always have a record of your purchases, making it much easier to budget and control your finances.
“It also means that you have a higher level of protection, as dropping a bank card is much less disastrous than dropping a purse or wallet full of notes.”
Smartphone users can now use apps which allow small amounts of money to be transferred between users – making it easy for friends to pay each other back after group meals or nights out – while contactless payments allow people to pay for transactions under £20 without having to enter a pin number.
Matt Sanders, money spokesman for Gocompare.com said: “I’m definitely a huge fan of carrying less cash – when electronic payments are available it means you’re not in danger of running out of a way to pay and it’s more secure than carrying around a wallet full of notes.
“I think we will see people using less and less cash as time goes on.”