A joint statement from FCA and PSR stresses that although there has been an overall decline in use of cash, withdrawals have started again as restrictions ease, and there must remain access to cash and banking services for those that need it. Industry, government and regulators must act together to ensure this availability, particularly for vulnerable customers, while supporting others in transitioning to digital and other alternative payment methods. The regulators support the Government’s plan to legislate to maintain access to cash, and expect firms to play their part – for example by ensuring alternatives are available to customers, if a firm closes a branch or ATM. Over the short term, reliance on Post Office and LINK services is likely to be significant.
Sheldon Mills, Consumer and Competition Director at FCA, spoke on the current state of cash use, showing how it was declining even before the pandemic. 84% of consumers had made a contactless payment in the 12 months to February 2020, and 27% used mobile wallets. But before the pandemic, 24% of all transactions were still cash transactions.
To address some of the issues caused by branch and ATM closures, one key concern has been that consumers may have been forced to pay to use ATMs, or travel significant distances. This is why FCA is calling on industry to support local community access, but of course in a way that complies with competition laws.