A landmark agreement has been reached between banks to provide shared services to ensure continued access to cash in communities across the UK, according to LINK, the major ATM network in the UK. The agreement comes amid mounting pressure over UK bank branch closures as more people switch to mobile and online banking.
According to consumer campaigning group Which?, the rate of bank branch closures has increased significantly in 2021, peaking between June and August when 298 branches closed their doors – an average of 99 per month.
In total, Which? revealed there have been 736 bank branch closures this year, with another 220 already set to close in 2022. Since January 2015, banks and building societies have closed or scheduled the closure of 4,734 branches.
The retreat from the high street has led to significant concerns over access to cash for vulnerable and older people who still rely on notes and coins in their daily lives.
Barclays, HSBC UK, Lloyds Banking Group, Nationwide Building Society, NatWest, Santander UK, TSB and Danske Bank have agreed to the new approach, with some other firms also considering joining up.
The collaboration, achieved through the Access to Cash Action Group (CAG), signals a long-term commitment to ensuring widespread cash and banking access for communities where services are limited.
It means that, from Wednesday, if a bank involved in the initiative decides to close a branch, it will inform ATM network Link, according to Wigan Today.
Link will independently assess what the closure means for cash provision, looking at the community as a whole, including its residents and businesses. It will consider whether a new solution is needed.
If, for example, there are no bank branches remaining, Link could consider whether there is a local Post Office. It may, for example, suggest a refurbished Post Office branch or a bank hub.
Bank hubs involve banks working jointly to offer basic cash services on high streets, with spaces for people to speak to their own bank. Each bank may offer its own services from a hub, on different days of the week.
As part of this new commitment, LINK is taking up a new role as the Cash Action Group’s dedicated co-ordinating body and will independently review the impact of all changes to banking provision in communities. LINK will commission new services such as shared banking hubs and ATMs where needed to meet the cash needs of the community as a whole and not just the customers or members of one bank or building society.
As a result, LINK has determined that the following new services will be provided, with further announcements to come in 2022: shared banking hubs and more free-to-use ATMs.
The Post Office is also ready to deliver new and improved dedicated cash services in up to 30 branches.
„We are pleased to see firms taking steps to maintain access to cash. Cash is an everyday part of life for approximately 5 million adults in the UK. The Cash Action Group’s initiative will rely on the commitment of the firms involved to meet evolving local cash access needs.” – the Financial Conduct Authority (FCA) said in a press release.
„Our current assessment is that most people have reasonable access to cash and we monitor and publish coverage levels quarterly. Individual firms remain responsible for making sure their own customers are treated fairly. Where a firm closes a branch or ATM in a local area we expect them to assess alternatives that are available or could reasonably be put in place to meet customer needs.” FCA concluded.
In July 2021, the Government consulted on legislating to protect access to cash in the long-term. Ahead of future legislation, both the Financial Conduct Authority (FCA) and PSR will continue to monitor access to cash.
„We will watch how the Cash Action Group’s initiative develops. The FCA will use what it learns to inform any work on the proposed future regulatory regime, including future requirements for cash access.” the authority said.
Find out more about FCA work to protect access to cash.
Sheldon Mills, Executive Director of Consumers and Competition at the FCA, said:
‘It is crucial that appropriate access to cash is maintained for those who need it, so we welcome this industry initiative by the Cash Action Group. Banks and building societies remain responsible for assessing the impact any closures of their branches may have on their customers, including those with characteristics of vulnerability, and for considering what alternatives could reasonably be put in place. We hope this initiative will help maintain access to cash and will be watching it as it develops.‘
Chris Hemsley, Managing Director of the PSR, said:
‘We want to see industry working together and at pace to meet their customers’ needs. We welcome the work of the Cash Action Group and I hope that it brings confidence to consumers and businesses that access to cash will be maintained for those who need it. We look forward to seeing progress and updates on next steps as this initiative develops.‘
Natalie Ceeney, chair of CAG, said: “We know that demand for cash is declining, but we also know that it continues to play a vital part in the lives of at least five million people in the UK – including some of the most vulnerable in society.”
Cash use is still around 35% below pre-Covid-19 levels, those behind the initiative said. But millions of people across the UK still use cash daily and many businesses need places to withdraw and deposit it.
Caroline Abrahams, from Age UK, said: “This is arguably the most promising development we’ve yet seen in ensuring that older people can continue to access cash.”
The UK Government has said it will legislate to protect the future of cash.
John Glen, Economic Secretary to the Treasury, said: “Access to cash has ongoing importance to the daily lives of millions of people across the UK, and protecting it is a priority for myself and this Government.”
The new shared services will run alongside other industry initiatives to support cash, such as “cashback without purchase” which is being rolled out to 2,000 retailers by the end of 2021.
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below:
