Telecoms companies turn away GBP165 million a month by not accepting cash

Major telecoms companies could be losing over GBP165 million in revenue every month by failing to offer customers the option to pay in cash, reveals new research from the Post Office.

Almost six million UK households use cash or cheques to pay their bills, either through choice or lack of access to banking services. But many major telecoms companies – such as those offering combined broadband internet, telephone and digital TV packages – are excluding these people by limiting payment to direct debit only.

There are 2.8 million1 UK adults (1.9 million households) without a bank account who rely on cash payment methods to pay their bills. A further six million people with bank accounts (four million households) actually prefer to choose cash over direct debit when paying their bills.2 Combined, these people represent 14.6 per cent3 of the UK population.

With an average monthly telecom and entertainment package subscription costing GBP28 per month4, this equates to a potential GBP165.2 million in lost sales per month for businesses who fail to accept cash or cheques.

Post Office marketing director Gary Hockey-Morley said: “Failing to offer a cash payment channel means that businesses are restricting the size of their potential market, with some telecoms companies ignoring customers worth over GBP165 million per month.

“With 14,000 branches across the UK, and 99 per cent of people living within three miles of a branch, the Post Office offers an easy route to bill payment services for people who choose to pay their bills in cash and can also ensure that companies are socially inclusive in offering their services to people without bank accounts.”

The Post Office provides a range of bill payments services, enabling cash payments for telephone, cable TV, utilities, mail order, council tax, travel and insurance providers to be made at any UK Post Office branch. When it comes to making regular payments by cash or cheque, the Post Office is the most popular channel with customers – 59 per cent pay their telephone bills[1]using cash or cheque at their local Post Office branch.

To find out more about Post Office bill payment services call 0845 6070 799 or visit the business services section on the Post Office website www.postoffice.co.uk.

Notes to Editors

Over 50 per cent of all household bills paid by cash or cheque are paid at the Post Office 5, including 89 per cent of road tax bills, 56 per cent of electricity bills and 66 per cent of gas bills.

Post Office HomePhone offers customers a wide range of payment options including cash or cheque over the counter at a Post Office branch or monthly direct debit.

Sources

1 House of Commons Treasury Committee “Banking the unbanked”: banking services, the Post Office Card Account and financial inclusion, Thirteenth Report of Session 2005-06, Publishes 19 November 2006

2 Consumer Payments Survey (CPS) 2006/7 published by Bacs’ , conducted with Ipsos-MORI

3 8.8million people pay their bills by cash, which is the equivalent to 14.6 per cent of the UK population.

4 Average cost of GBP28 is the mean average of the two UK companies offering a combined telephone, internet and digital TV package.

5 The Way We Pay Our Bills report 2006, published by APACS