Cash was used for 60% of all transactions in 2007 against 54% of transactions the previous year. By value, cash now accounts for 34% of retail spending compared with 32% a year ago.
The BRC said that rising cash transactions were good news for retailers as, on average, a retailer is charged 2p for processing a cash transaction while credit card transactions cost retailers 34p and debit card transactions cost 8p. The survey found that retailers were charged £516 million for processing fees in 2007 of which £424m related to card payments.
BRC director general Stephen Robertson said: "Reports of the death of cash are premature. Cash is not only alive, it's thriving. Hard up customers are increasingly reluctant to spend money they haven't actually got in their hands. While total retail spending continues to grow, there is a widening gap between the amount spent in cash and the amount spent using cards, suggesting customers want to keep tight control of their finances."
The BRC's Cost of Collection survey includes results from 17,000 shops including both multiples and independent retailers with a combined turnover of £131 billion.