Post Office issues payment warning as nearly one in three shoppers unable to pay at checkout

Yet 90 per cent did not include accepting cash in their contingency plans, despite 83 per cent having a written or agreed back-up strategy.

Ben Hunter Woollard, head of banking at Post Office, said: “A payment outage can disrupt trading in seconds, resulting in customers being turned away and sales lost.

“Cash has helped many retailers continue trading during recent disruptions, but it is rarely included in formal contingency plans.”

He added: “With the Government encouraging households to keep some cash available for emergencies, retailers should also consider how they will keep serving customers if digital payments go down in emergencies. If cash usage is being encouraged, so should its acceptance.”

Payment outages cost high street retailers an average of £255 for every hour they last, according to the research.

Retailers surveyed reported an average of three payment disruptions over the past year, with the frequency expected to increase.

Nearly a quarter, or 24 per cent, reported having to turn customers away, delay or pause transactions during disruptions. Some 22 per cent reported being unable to serve customers at all.

Only 32 per cent of high street retailers surveyed said they currently accepted cash. The research also found that cash helped 69 per cent continue serving customers during digital payment outages.

The Post Office’s new guidance encourages businesses to review their cash acceptance policies, prepare for payment disruptions and clearly explain payment options to customers.

Mr Hunter Woollard said: “Our new guidance gives retailers practical steps to communicate clearly with customers and build a plan that works for their business.”

Beyond emergency situations, cash remains a significant part of everyday commerce. Transactions made exclusively with notes and coins contribute £27billion annually to the UK economy.

More than half of consumers (58 per cent) use cash for routine purchases, while for over a fifth (22 per cent) it is their preferred way to pay.

Contactless cards may now be the most popular payment method overall, but cash clearly retains a substantial role in how millions of people manage their daily spending.

Despite this, only 28 per cent of high street retailers said that community needs and customer payment preferences play a role in shaping which payment methods they offer.

That gap between consumer habits and retailer decision-making suggests many shops risk losing trade by overlooking how their local customers actually want to pay.

Ed Woodall, Chief Executive of the Association of Convenience Stores, said: “Cash remains an important payment method for customers in convenience stores, with 99% of convenience retailers accepting cash.

“When people lose access to other payment methods through outages or issues with networks, cash is a crucial safety net that allows businesses to continue trading and serving their communities.”

Postmasters working at the centre of local communities witness the reliance on cash first-hand.

Melissa Samuel, postmistress at Bourton-on-the-Water Post Office, said: “We have local businesses regularly coming into the Post Office to deposit their cash takings, but just as importantly, they also use our change-giving service, so they have the notes and coins they need to serve their customers.”

Ms Samuel noted that when card terminals go down, customers frequently arrive at her branch after being directed there by nearby shops so they can withdraw cash and complete their purchases.