Be careful about going entirely cashless

We have now seen several instances of electronic banking go down with people unable to use their debit cards and unable to get cash out of ATMs.

For example in 2014, both NatWest bank and RBS experienced technical problems that meant their ATMs didn't work. And in 2013, both banks experienced the notorious "cyber monday" problem when all their cards (debit and credit) stopped working on the biggest shopping day of the year. People buying online were merely inconvenienced, but people buying groceries were embarrassed as they only realised the problem when they came to pay at the till. Even worse was the fate of those who had bought petrol and then went to the kiosk to pay. Petrol stations usually don't let you leave without paying as you have already put your petrol in your tank.. In August 2021, Natwest's website and mobile banking app went down.

So how do you protect yourself from such nightmares?

First of all have more than one debit card, from a different group. NatWest and RBS are part of the same group. And Halifax and Lloyds are part of the same group. Santander is separate from both, as is HSBC. So as long as you have two cards, from different groups entirely, the chances of both cards going down at the same time is unlikely.

Of course it is possible that the clearing houses, faster payments networds and chip and pin networks can go down across the board, leaving you in trouble. This is where it is wise to have some cash in your wallet, just in case you need to buy some groceries and petrol. It is also wise to leave reward points on your Sainsburys and Tesco loyalty cards, because in an emergency, you can use those to pay for groceries if there was a complete blackout of the banking system.

The key takeaway is to prepare. Not everything will work 100% all the time and you can save yourself a lot of stress by having alternative methods of paying.