A local business owner has spoken of how she has had to urge customers not to use cash after all banks disappeared from her town. Monica Hardman, the owner of Shoreham Knitting and Needlecraft in Shoreham, West Sussex, that all branches had now gone, and it would be too hazardous to continue non-card payments. The town does, however, still have a Post Office and a banking hub.

"Originally, we had six banks in our town, and our own HSBC closed over eight years ago," she told BBC Radio 4's Today programme this morning.

"I opened three bank accounts, one after the other trying desperately to operate cash, and gradually all these banks closed, until last year we had none. So a banking hub opened at the end of our high street in March of last year. I looked at the situation again, but decided that it was too dangerous. One of the reasons was that it was too dangerous for a member of staff to walk down the road on a regular basis, five minute walk, carrying large amounts of cash."

Ms Hardman added: "Our last bank that closed early last year was actually next door to us."

When asked if she felt like she was missing out on income by paying charges for card transactions, she replied: "No. Our debit cards are 1.37%, we're charged, and most people use debit cards. Credit cards are under 1%.

"Cash, if it's paid in, is 1.5% of total money paid in."

The programme had another business owner, Katie Jones, of Katie's Cakes in Wolverhampton, who was championing cash payments.

She described how she used the cash she earned in her shop to purchse goods from other local businesses, and that some of her customers simply did not want to use digital payments.

These include low-income individuals who find it easier to keep track of their finances if they have physical change or notes.

Ms Hardman said that only about 25% of her total take was cash, adding: "If someone is actually stuck, we do actually help them, and we have paid ourselves with a credit card, or a debit card, and they've given us the cash."

It comes as a Treasury Committee of MPs warns that businesses could need to be forced to accept coins and banknotes in order to make sure that the UK does not drift into a loss of cash acceptance for those who rely on it.

A report said: "There may come a time in the future where it becomes necessary for HM Treasury to mandate cash acceptance if appropriate safeguards have not been implemented for those who need physical cash, and the level of cash acceptance begins to lead to widespread detriment.

“To ensure that HM Treasury has the information it needs to make this decision, cash acceptance levels in the UK must be monitored to ensure we do not sleepwalk into a loss of cash acceptance for those who need it.

“HM Treasury must provide the Treasury Committee with annual reporting on cash acceptance levels and provide an analysis of HM Treasury’s view of the tolerable level of cash acceptance in society.”