Cashless society: Winchester pub's cashless shift - is it illegal for a business to refuse legal tender in UK?

Pub customers are outraged over its recent decision to stop accepting cash, despite it having no legal requirement to do so.

Angry patrons have criticised the move at The Old Vine in Winchester, Hampshire, accusing staff of overreach, after a video circulating on social media showed a tense exchange between a customer and an assistant bar manager.

The customer was attempting to pay for drinks at the historic inn with a £20 note, but the assistant bar manager insisted on a card or mobile phone payment.

The decision, which has led some customers to turn away, has been met particularly negatively by the older generation, who argue that they prefer the freedom of using cash.

On the other side of the argument, some have suggested providing training for "technophobes" who feel left behind as society becomes ever more cashless.

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Despite the customer’s protestations, UK businesses - including private, independent ones like pubs - are not legally obliged to accept cash as a form of payment, and have the right to set their own terms of payment, including accepting only card or digital payments.

It is only if a business chooses to accept cash that they then must accept all legal tender, which includes Bank of England notes and coins.

The Payment Services Regulations 2017 does require businesses to provide clear information about accepted payment methods before a transaction takes place.

This means that if a business only accepts certain forms of payment, they must make this clear to customers before any purchases are made.

“Legal currency" refers to any form of money that is recognised by law as a valid medium of exchange. This includes both physical currency and digital forms of money. While cash may be legal currency, it does not have to be accepted as legal tender by businesses.

The assistant bar manager in the video is also not likely to be the individual responsible for implementing the cashless policy. She is merely carrying out her job duties, enforcing the rules set by higher management or the owner of the establishment.

Frontline staff members often endure long hours, physically demanding work and interactions with challenging customers. Engaging in a heated argument only adds to their stress, especially when they are simply following the protocols set by their employers.

Private businesses may opt for a cashless policy for several reasons. Not handling cash reduces the risk of theft and eliminates the need for storing large amounts of cash on the premises, which can be a security concern.

Handling cash also comes with various costs, including those associated with cash management, security measures and the risk of counterfeit money, and in light of health concerns in a post-pandemic world, going cashless can minimise physical contact and the transmission of germs through banknotes and coins.