Cash is still king when people buy everyday items, especially goods costing less than £10, the study by Alliance & Leicester Commercial Bank said.

The figures show that notes and coins are the most common payment method at newsagents, pubs, clubs and takeaways, despite other recent research claiming that spending on plastic has outstripped cash for the first time.

Russell Carter from Alliance & Leicester told Finance Today:

"Local businesses and traders such as newsagents, snack bars and cafés are being supported by the UK’s spontaneous spending culture. A move towards a 'cashless society' could be detrimental to these businesses as many don’t currently have the capability to accept payment by credit or debit card."