/ Money

Win! Government will protect access to cash

I wrote to the Chancellor as part of our week of action to save bank branches and ATMs across the country. Today, the government has acted. Cash will be protected.

11/03/2020: Win! Cash will be protected

It’s been confirmed in today’s Budget that the government will bring forward legislation to protect access to cash and ensure that the UK’s cash infrastructure in sustainable in the long-term.

Read the full announcement

Thank you to the thousands of people across the UK who joined us in calling for the Treasury to act, which culminated in my visit to Downing Street to deliver a brief case full of your stories.

Which? CEO Anabel Hoult drops off the comments submitted to Which? Conversation to No 10 Downing Street

We know that the cash system faces irreversible damage within the next two years, so the government must swiftly press ahead with these plans to legislate, which must include putting a single regulator in charge of protecting cash.

It’s vital that today’s commitment is quickly turned into action.

We look forward to working with the government, regulators and industry to ensure that cash is protected for as long as it is needed.

26/02/2020: My letter to Rishi Sunak

Dear Chancellor,

The UK’s ATM network is on the verge of collapse.

In the past two years, 9,000 free cash machines and 1,200 bank branches have vanished.

We’re even being charged a fee to access our own money at 25% of the cash machines that remain.

Understandably, millions of people are unhappy about this. They rely on cash. For many of them, cash is the only option.

If things carry on as they are, cash as we know it will cease to exist in just two years.

Yes, digital payments are good, but right now the UK isn’t ready to go cashless. The government promised to maintain our access to cash.

As the new Chancellor, this budget is your opportunity to turn that promise into action.

Which? is the UK’s largest consumer organisation. We stand ready with our 1.3 million members and supporters to work with you, to protect cash for the millions of people who need it.

If you don’t act now, free access to our own cash will soon be gone forever.

Yours faithfully,
Anabel Hoult, CEO, Which?.

#protectcash
which.co.uk/protectcash

Do you feel that the Government should make sure cash is protected in the next budget?

Yes (100%, 2,739 Votes)

No (0%, 12 Votes)

Not sure (0%, 1 Votes)

Total Voters: 2,752

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Why do you want the government to protect cash?  Tell us why in the comments below, and we’ll share them alongside Anabel’s letter this Friday. 

Comments

Here is a Which? article that was posted after the budget: http://www.which.co.uk/news/2020/03/budget-2020-chancellor-poised-to-protect-access-to-cash/ ‘It is vital that this commitment is quickly turned into action. We look forward to working with the government, regulators and industry to ensure that cash is protected for as long as it is needed.’

It’s very encouraging to see Which? determined to work with those who can take action to do something about poor access to cash in some. parts of the country.

David Freund says:
12 March 2020

Having access to cash is an essential part of our democratic rights.

Unfortunately it actually isn’t, David. It is not even part of your contract with your bank.

Let us hope the legislation promised by the government will ensure that a right to [free?] access to cash at any machine anywhere in the country, and throughout the country wherever population settlements exist, is enshrined in law. I suspect that might be too ambitious, however.

I am concerned that there might now be a rash of closures of bank branches and cash machines in order to beat the legislation and I can’t see what could stop it other than public disapproval that affects the banks’ reputations.

Given the latest cut to interest rates, perhaps we should all turn to keeping our savings at home as cash rather than in bank accounts?

I doubt whether most people could manage without a bank account to receive income and make payments automatically but savings is a different matter and I should not be surprised to see savings accounts dwindling to nothing as the returns are now minimal.

I was considering taking out an ISA before the end of the tax year but looked at the rates and terms and it’s hardly worth the bother. But what is the alternative to keeping money in a savings account of some form if access to it might be required for a major purchase or expenditure?

John wrote: “Let us hope the legislation promised by the government will ensure that a right to [free?] access to cash at any machine anywhere in the country, and throughout the country wherever population settlements exist, is enshrined in law. I suspect that might be too ambitious, however.”

Many villages have never had an ATM or bank and residents have managed to cope. Complaints have arisen largely because facilities have been withdrawn.

It’s difficult to know what the best policy on distribution will be. I feel there should be some reinstatement of withdrawn facilities although the past provision might have been haphazard and not based on any rational principles.

It would be interesting to know what people think should be the right coverage, bearing in mind that some tiny settlements might be isolated but still need access to cash.

To meet the expectations of all those who have commented in this and related Conversations will not be easy or economical.

Here in Gloucester, there seems to be no shortage of free cash points at all. Almost all convenience stores, food shops, shopping malls and bus, railway and petrol stations seem to provide them, as, of course, do banks.

From what I’ve seen in more rural parts of North Wales, there are no longer any bank branches and most of the ATM’s are located at larger food shops or at some petrol stations.

As John says, provision of ATMs could have been rather haphazard. I presume that the ‘surplus’ machines in some cities and towns may have made economic sense, reducing the number of times they need to be refilled.

Where there is clearly a need for an ATM, perhaps a building such as the village hall or other public building could provide a suitable site.

It would be interesting to know how some rural communities have coped without ATMs and banks in the past. We might learn something.

I think rural communities found a way about once a week or every fortnight of going to a market town for food and household essentials and were able to access cash at their bank. People helped each other with cash in return tor a cheque, and many shopkeepers would recycle cash taken over the counter in exchange for cheques from trusted customers. Most communities had at least a post office which paid out pensions and benefits in cash, and even villages had banks. Nowadays, the withdrawal of rural bus services or reductions in services have made visiting a bank even more difficult.

I never gave this any thought until Which? launched the first Convo about saving ATMs. You are right that loss of bus services and Post Offices makes life harder. Most of the discussion here is about individuals being able to obtain cash and wanting to be sure that they can continue to spend it, but some have mentioned the problems faced by small businesses that no longer have access to a local bank.

It will be interesting to see how the government addresses the current challenges. Having seen what the Office of Public Safety and Standards has failed to achieve since its creation I am not optimistic.

Marlene Raddings says:
12 March 2020

Thank you for doing all you can to help people.

David Hall says:
12 March 2020

The Government must be mad having a big spending spree in the recent budget. Does any one realise that the National Debt now stands at over £2 Trillion, 320 Billion and is rising at a rate of £5,170 PER SECOND, or to put it another way each citizen of the UK owes £37,251, or each Taxpayer owes £64,000. If I ran my personal finances like that I would have gone bankrupt 1000 times over ! See :- http://www.nationaldebtclock.co.uk/ It is just creating a Massive Debt for future generations to pay off at some point in the future

Since, by a circuitous route via our savings accounts and the banks, it is our money that is funding the government’s borrowing, it possibly cancels itself out. Everyone who pays interest on a loan is contributing to the money that the government borrows.

Sue G. says:
12 March 2020

Many people, like market traders can only receive cash.

Martin Daines says:
12 March 2020

We MUST keep the ability to use cash when ever we want and not be bullied otherwise.

Barrie Tittensor says:
12 March 2020

As a Pensioner, I use cash every time I leave my House, ATM are disappearing all the time
such that I either catch a bus ( no shelters ) or walk ( recent knee joint ) these simple tasks
are now difficult !! also, I get charged to access my pension cash.
I 100% support your stand against disappearing ATM and the remaining, charging for accessing my money.
My Best Regards Barrie

George E Sargeant says:
13 March 2020

I do understand that there must be a cost in servicing the cash machines. However, with banks being out of reach of many people who are unable to travel long distances, the cash machines are necessary. Therefore the Government should protect us by ensuring that we have access to our money. [Free of charge]

It cannot be entirely free of charge, George. Bank customers will meet the cost of cash provision in one way or other, but not necessarily at the point of delivery.

A point of great importance is that cash should be accepted as payment for all over-the-counter transactions.
The increasing number of card only retail outlets deprives many people, without cards or credit ratings, of access or the ability to shop.
This is the currency of the realm and should be accepted in all reasonable circumstances.

But anyone who actually has cash can shop at such places if they first go and buy a prepaid card, see:-https://www.money.co.uk/prepaid-cards.htm

Thanks for this link, Derek. I had associated prepaid cards with foreign travel and the possibility of expensive fees, but they look like a useful option for anyone who needs control of expenditure that a credit or debit card does not offer. Here is another link: https://www.moneysavingexpert.com/credit-cards/prepaid-cards/

I prefer to use cash rather than card, couldn’t cope with having to pay small amounts with cards. Taking away cash is yet another way of restricting our freedom of choice

A Scandanavian country did without cash and found that it did not work. Why does GB not pay attention? Why is it assumed that a cashless society will work across all society

It has and it doesn’t. The UK government has pledged to protect access to cash and legislate to make the banks comply. It is not the government that has been withdrawing cash facilities or seeking to progress towards a cashless society, although to a significant extent that policy is a response to customer behaviour.

ROSE CHANEY says:
28 March 2020

Well done. Brilliant. Plenty of people need cash for bus or taxi journeys. Life is complicated enough without having to travel miles to access your own money.
Also, smaller holiday towns and villages need ATM’s to enable tourists to buy things locally from small businesses – essential as agriculture provides so few jobs these days in rural areas

During the coronavirus outbreak, those who are self-isolating may need cash to pay people who are helping by doing shopping for them. Here is a Which? article that may be useful: https://www.which.co.uk/news/2020/04/how-banks-are-helping-vulnerable-customers-during-the-coronavirus-crisis/

Some people [especially solo traders] are reluctant to accept cash in the present circumstances and prefer a bank transfer.

The government has pledged to maintain access to cash for so long as people need it and is exploring new ways to provide access.

Tesco Bank has decided to introduce a free, secure, cash delivery service for elderly and vulnerable customers. The Post Office started a similar service for elderly and vulnerable customers in April this year.

During the coronavirus emergency many people who have always used cash have had to change their ways and use other payment methods. Some may not wish to revert when normality returns, but this is a useful development which the other banks should follow. It’s been used for years for delivering foreign currency.

I couldn’t see any reference to this on the Tesco Bank website but there are further details here –
https://www.lep.co.uk/lifestyle/bank-offers-free-cash-home-delivery-service-customers-lockdown-2850286

Many don’t like accepting cash under the present circumstances because of possible infection transmission.

The natural evolution in payment methods continues. I doubt that we will see the end of cash but additional methods of its provision need exploring and implementing. Much has been discussed on this in Convos.

When I use my non-contactless credit card when buying fuel, I use a key to tap the keys.

There has never been a better example of the need for banks to provide access to cash. Without cash in hand I would not have been able to pay my neighbours for food and OTC meds they have delivered on a weekly basis over the past 2 months.

Thanks for that link, Wavechange. That is a very good summary and bang up to date. I was pleased to see that more banks are now providing a cash delivery service to certain customers.

It would be helpful if there was a simple index on the Coronavirus Latest section as I find it difficult to see what advice might be available without clicking on various different categories. In that section, under the Protecting Your Finances category [then click the ‘show more’ button], this one is called “Which banks are helping vulnerable customers during the lockdown?“, but its actual subject title is “Banking during lockdown: cash deliveries, dedicated telephone numbers and more“, which is much more useful. Perhaps my intuitivity aptitude is deficient.

I suppose I would like to see an index with the word “cash” or “access to cash” on the landing page for the coronavirus advice section.

I would also find it useful if these advice and guidance articles were dated [and redated after each significant update].

Finally, at the risk of being over-demanding, I would find it useful to have a facility for getting e-mail announcements of new advice or significant updates either across the board or by category, or even by subject.

With the banks now providing costly additional services free of charge and a big fall in the amount of money flowing into commercial and personal accounts, it must only a matter of time now before there is a review of service charges and minimum balance requirements. I bet they are thinking about it but dare not mention it for the time being.

Thanks Wavechange. I had to venture out for a blood test but took a route away from the village and also took a mask which I put on just before entering the Practice.

Afterwards I had to get to an ATM for cash so also wore a surgical glove. The machine seem to realise the fingers pressing the buttons were not real and repeatedly refused to give me cash so I had to enter the local store and draw cash from their machine, minus the glove. Has anyone else experienced the same problem?

All this happened when I should not have left the house and spent the next few days hoping I had not been infected with the virus.,

I thought that ATMs had physical buttons and could be used when wearing gloves, but had never tried. I can understand why using a smartphone might be a problem but mine does work when wearing ‘disposable’ gloves. It would be interesting to know if others have had similar problems with ATMs.

We don’t know enough about the virus but it seems highly unlikely that an infective dose could be transferred by touch, especially if we keep our hands away from our face until they have been washed.

If you do online or mobile banking it’s very easy to pay anyone with a bank account.

Did you have much difficulty in sourcing the mask, Beryl?

Finally, a small step towards dealing with the problems created by closure of banks, ATMs and Post Offices, eighteen months after the Access to cash Review was published: https://www.bbc.co.uk/news/business-53068282

“Banks have been persuaded to pay for the pilots, trying out ideas like shared branches, more cashback in shops, as well as better bus services to allow people to visit surviving branches.”

I am keen on shared branches because I used one years ago.

Which? say “….new solutions are desperately needed……. But these are not new solution. They have all been proposed in these Convos but, instead of taking them on board, Which? seemed to focus on ATMs.

I hope this experiment does, and expect it will, produce workable solutions that will spread country wide. We need to make access to cash available to far more people than currently have it, or have ever had it. That will not be done with ATMs.

The reason that ATMs were introduced is that they are more efficient than manual handling of cash. Many have disappeared not because they were uneconomic but because of bank branch closures. With a little forethought they could have been moved to nearby buildings such as village halls.

It’s good to see Which? get a mention, in my view.

Many ATMs have been removed where they were in clusters or close to others and underused as cash use reduced. LINK are protecting ATM closures where there is not another within 1km.

Whilst ATMs might be efficient at dispensing cash they are expensive to install and service. They do not give convenient access for those many millions of people who do not live near one. They never have. We have an opportunity to bring in new solutions to enable almost everyone to conveniently access cash.

Yes, clusters of ATMs have been reduced and that is not a problem providing that those that remain are kept filled. The problem is removal of ATMs and branches without the banks making alternative provision. It’s not just access to cash but loss of banking facilities for small businesses with cash to deposit.

I have no problem with alternative means of access to cash. Cashback is well established but is only available from some retailers and only to customers. I hope that alternatives will offer more than that.

Having experimented with mobile banking, I think it could be developed to make it as easy to pay someone else as to use cash. Nevertheless there will be a need for cash for years to come and no doubt that there will be different solutions to meet the requirements of the public and small businesses. For the time being I would like to celebrate this one small step.

11500 post offices have helped fill the gap in many places by offering key banking services to most with bank accounts and dispensing cash. That was an initiative developed by the banks.

If we largely don’t use bank branches and ATMs, because we choose other ways of dealing with our finances, we must expect consequences and not close our eyes to reality. We could, of course, heavily subsidise these facilities or we can come up with new solutions that recognise and address change. I’m in favour of the latter.

I wonder if Which? will issue a press release on this experiment and whether they will put a positive slant on it?

One of the problems with the closure of bank branches, and the consequent loss of the installed cash machines, has been the completely uncontrolled and uncoordinated way in which it has happened.

Each bank made its own decisions, apparently without regard to the availability of alternative sources of cash and other banking services. Ultimately, it turned into a race between the banks to get out of town fast and avoid becoming the last bank with an expectation of having to remain there whether or not it was economic to do so.

In the small town where we used to live [population about 5,500 but serving a large rural hinterland] there were branches of Barclays, HSBC, Lloyds, NatWest, and TSB, plus five building societies and the Post Office with ATM’s, and three supermarkets also with ATM’s. They were all within a short walking distance of each other. After we moved away the rationalisation began with NatWest closing its branch. It was virtually opposite the Nationwide so there was no perception of a problem with continued access to cash. The Post Office announced its intention to close the rather handsome and generously proportioned Crown Post Office; luckily that didn’t happen because they could not find alternative premises for a more limited provision; there was some consternation in the town but access to cash was not one of the concerns. One of the building societies closed following a merger, another one removed its ATM, and a supermarket changed hands and was remodelled with the ATM taken out and not replaced. The three remaining major banks [Barclays, HSBC and Lloyds] have remained, largely to serve the business and farming communities. The rest are hanging on but I suspect the basic economics are not improving.

The point is that there is no coherence in any of this so if the demand for cash continues to decline there could be a wave of closures, each one with the assumption that provision remains adequate and will continue to be so.

Another important consideration is the deposit of cash and cheques. I don’t know the proportion, but many ATM’s – especially those in external locations – do not have a deposit facility with envelope provision, partly because of their technical unreliability but also because people prefer to pay money in over the counter; as bank branches decline in number this becomes increasingly difficult. I hope the pilot cashpoint scheme will take into account the need for deposit facilities as well as for the dispensing of cash.

Another aspect of the trial scheme that I thought was interesting was the alternative idea of improving local bus services to the nearest town with bank branches. This would not only facilitate cash withdrawal but provide a useful service for smaller communities. My reservation is that previous attempts to improve rural and suburban bus services, following the closure of railway stations and other circumstances, have rarely endured and require a considerable subsidy.

Ultimately, I feel that banking economics and commercial considerations rather than customer priorities will drive the provision of cash facilities. Once a service has been withdrawn the public find other ways of managing, and entrepreneurial retailers, publicans, and service outlets will accept new ways of operating to meet the latent demand. The pilot scheme appears to be well designed to test a range of scenarios and meet diverse needs so I hope it is successful, but following the present coronavirus emergency I have a funny feeling that government policy to protect cash and the public’s inclination to use it are moving in opposite directions. Unless the government’s actions rapidly start to restore confidence in cash and in the safety of cash transactions, the gradual withdrawal of ATM’s could turn into a stampede once the tipping point has passed. As Malcolm has mentioned, ATM’s are expensive to provide and service. They also have increasingly high security risks and represent an enormous but idle asset in terms of the contents of the vault in each machine.

LINK are doing a good job, I believe, in protecting the distribution of ATMs, including providing much higher payments per withdrawal invulnerable areas, ensuring if an ATM is removed that there is other local access to cash, finding new owners when an ATM is at risk, having a scheme to request new ATMs and so on.

However, ATMs as the universal facility for everyone can never be the answer. We must pursue alternative solutions and get them into a workable form with everyone’s support.

Like John I don’t particularly like depositing cheques in an ATM, although I would if it was part of my bank, as mine at the local Nationwide office is. There are banks that, I believe, allow cheques to be scanned on a smartphone (for those who have them, and no doubt up-to-date operating systems. Post Offices allow most bank account holders the facility to deposit cheques.

Malcolm – I haven’t paid a lot of attention to the LINK network, but are they also involved with the ATM’s provided by banks inside and outside their own branches and occasionally elsewhere [such as at railways stations]?

No, LINK operate the interchange fees that banks pay for ATM withdrawals. They are not responsible for ATMs as far as I know but are charged to do what they can to protect the network. It is worth looking at their website to see their role and to look at the monthly reports they issue on the “ATM footprint” which looks at protected ATM activity. I think they do a good job.

John – As you point. out the banks have operated independently. This is one of my concerns and what is needed is management of what is an essential service for the public and small businesses – both branch services and access to cash.

Although ATMs may be expensive, there are plenty of locations where there are still large numbers. In town, a few miles away, we have numerous ATMs within a short distance. Not far away we have a modest supermarket with four machines. I presume that they are economic to operate. Like most people who keep personal current accounts in credit, I have free banking. Most of the ATM losses that I am aware of have accompanied closure of banks and other premises.

By all means look at alternative sources of cash but these need to be in place before further bank closures.

One of my frequent suggestions is that some of the self-service checkouts in supermarkets and other shops could dispense small amounts of cash, dependent of course on what has been collected.

I do hope the pilot schemes will be successful in helping the respective communities and that if so, others will follow.

You mention security and that is obviously an important consideration, which might determine what is practical in an area.

Some often suggest we should think about the vulnerable people and not just those favoured with the ability to access information and services. Very many people do not have and never have had convenient access to an ATM or bank branch. We need to think about them, don’t we?

The LINK criteria for protecting an existing threatened ATM is if there is not another one within 1 km. If we take this as the criterion for convenient access then to give this convenience to everyone in the UK would require around 240 000, without allowing for multiple ATMs in highly-used locations. Around 4 times the current number, many of which are less and less used.

It seems clear to me this is not a tenable solution. Therefore we need to pursue alternatives, examples of which have been repeatedly offered in Convos and given in the “Access to cash” report.

Instead of shillyshallying we should just get on with developing these proposals. We should be helping the vulnerable and those without adequate service, not focusing only on those currently served.