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The FCA’s and PSR’s joint approach to Access to Cash

Published 16 06 2020

For many people cash continues to be a vital way of making payments, despite the changes brought by Covid 19. As High Streets prepare to re-open, more shops will rely on the availability of cash and the ability to access banking services such as deposit facilities to be able to operate. 

Access to cash is a shared priority between HM Treasury, the Bank of England, Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR). These bodies meet as the Joint Access to Cash Strategy (JACS) Group. This statement provides an update on the approach being taken by the FCA and PSR. 

Addressing access issues during coronavirus

The shared objective of the FCA and PSR during the crisis has been to work with industry to ensure the provision of essential services for consumers, including access to cash, in light of bank branch and cash machine closures due to coronavirus and government restrictions. While the overall impact of coronavirus on closures and lost access has been relatively low and stable (with less than 10,000 people losing access to cash within a 5-mile radius), for some consumers the impact of this lost access can be significant. We have taken several actions to address this: 

•    Delivered a better understanding of cash access: we have developed a national map of access to cash, which identifies at a local level areas that have lost access to cash or other essential services due to temporary closures of bank branches and cash machines.

•    Used this information to support coordinated action: we have held weekly meetings with senior stakeholders from across the industry, including banks, building societies, the Post Office, LINK and the larger independent ATM deployers. We have used these meetings to share intelligence on where access problems were emerging, informed by our new mapping, to work with banks and building societies to ensure access has been returned as quickly as possible.

•    Overseen effective communication with people and businesses: when branches have needed to close, we have ensured that banks and building societies clearly communicate with customers to signpost nearby alternative services, such as the Post Office. 

•    Focused on the needs of the vulnerable: We have been monitoring the approach of banks and building societies to make sure that the most vulnerable people have alternative ways to access cash and other essential services, such as making in-person payments. 

•    Worked closely with consumer organisations: To continue to build our understanding of differing cash needs across the population, we have engaged regularly with consumer organisations to gain insights during the crisis and to understand the impact on specific groups, such as the vulnerable or elderly. 

We will continue to work closely with the industry as we move out of the coronavirus crisis, and use data to build on our work to date to maintain access to cash.

Our approach to access as legislation is developed 

Recent research from Which? shows that some groups of consumers (for example, the elderly, vulnerable and self-isolating) have continued to rely on cash for everyday activities, such as paying friends and family to buy shopping on their behalf. For these people access to cash will continue to be an essential service in the longer term.

We remain committed to helping ensure that consumers and businesses who need to access and deposit cash can continue to do so. In the longer term, legislation announced in the 2020 Budget should enhance our ability to protect access to cash for those who need it in a way that works for them. 

However, before this is implemented, maintaining reasonable access to cash is a shared challenge for industry and regulators. The FCA and PSR will work with the industry to explore how it can provide an appropriate and sustainable model of accessing cash for example through wider use of shared services and initiatives involving local communities. 

Alongside this, we recognise that firms may need to take decisions on their provision of cash machines and bank branches, including through banks’ membership of the LINK scheme. In considering these issues, the FCA’s focus will be engaging with them on the steps they are taking to consider the impact of these decisions on consumers who need to withdraw cash, and businesses who need to deposit cash. 

The PSR will continue to work with LINK, the operator of the UK’s cash machine network, to ensure that it does all that it can to protect widespread access to cash through the geographic ‘footprint’ of free-to-use cash machines. 

We intend to publish a further update on our approach and our work with industry later this summer.