by New powers will be put in the hands of local communities from Wednesday, enabling people and organizations to request an assessment checking for gaps in local cash access. From 18 September, a range of interested parties, including individuals, groups of people, organizations or local businesses, can make such requests.
Emad Aladhal, director of retail banking at the Transport Authority (FCA), told the PA news agency that the changes will support people who rely on cash, as well as local businesses. He said: “This is about making sure we keep the ability to deposit money and the ability to withdraw money in local communities.”
He said the FCA will ensure that designated banks and building societies, coordinated by ATM and Link Network Access Network, follow the changes. Under the reform, banks and building societies must assess whether changes to local services, such as closed branches or cash machines, leave local communities without the means to withdraw or pay cash.
The firm will need to consider the needs of local communities, shops and businesses and ensure that any changes implemented include reasonable access to cash. Another incentive for a review is residents, businesses, local representatives or charities who feel that their community is not being adequately served when they are able to pay or withdraw money.
Local charities or groups will be able to share a consensus on the needs of the community, including the most vulnerable residents and businesses that rely heavily on cash. Individuals or organizations could apply to Link as the supervisory body or to any nominated financial firm.
Nominated firms include: AIB Group (UK); NatWest/RBS/Ulster Bank; Bank of Ireland (UK); Bank of Scotland/Halifax/Lloyds; Nationwide Building Society; Barclays; Northern Bank (Dansk); Dahl Clyde Bank/Maidhde Argyd; Santander UK; HSBC UK; the Cooperative Bank; and TSB.
Businesses will need to assess and fill gaps, or potential gaps, in the provision of access to cash that have a significant impact on consumers and businesses. Mr Aladhal said that one possible example would be if someone running a charity found they had to travel a long way to deposit money raised for their good cause.
“Our rules are about making sure the banks and the coordinating body, like Link, listen to that,” he said. The assessment must be completed within a 12 week period.
Mr Aladhal said: “They will have to consider the current facilities for depositing money, the current facilities for withdrawing money, they will have to consider things like the travel times of individuals and businesses as well as the reasonableness of that travel time and the cost. .
“So it’s not about looking at a map and going as the crow flies, it’s about: Is there public transport? How expensive is it for people to use it? How hard is it? And yet.”
After the 12-week process, financial firms will go back to communities to outline their ideas – and the communities will be able to give feedback to that, he said. Mr Aladhal said: “If they identify a gap, we expect them to fill it as quickly as possible.”
Depending on the particular circumstances, ways to bridge the gap may include maintaining a bank branch, installing an ATM, introducing a banking hub (where several banks share facilities) or an Office-based solution the Post, which has an agreement with banks. allowing customers to do their everyday banking over the counters.
Mr Aladhal said that businesses had to ensure that “what is proposed really meets the need of that community”. The assessment should reflect the overall needs of the community, he said.
The FCA will use data to oversee how the rules work in practice. Its Financial Life Survey found that more than 6% of adults (3.1 million) used cash to pay for all or most items in the 12 months up to May 2022.
This percentage was 9% among vulnerable groups, including consumers who are digitally excluded, in poor health or on low incomes. Sheldon Mills, executive director of consumer and competition at the FCA, said: “The way money is spent is changing, with far less of us using cash every day.
“We don’t want to stand in the way of change, but we want to ensure reasonable access for those who continue to rely on cash. Our new rules are already having an impact, protecting vital services for communities across the country.”
The Financial Services and Markets Act 2023 sets out Parliament’s intention to protect access to cash. The regulator’s powers, which Parliament gives it to ensure that reasonable access to cash withdrawals and deposits is maintained, will not prevent bank branches from closing. But the powers that be will have an impact if branch closures leave significant gaps in local access to cash.
Thousands of bank branches have disappeared from high streets in the last decade. Consumer group Which? in May that more than 6,000 bank branches had closed since 2015.
In August, HSBC pledged not to announce any new bank branch closures until at least 2026. Link said 15 new banking hubs have been confirmed as a result of the new rules, taking the total to 163, with 81 already open and more to follow.
Adrian Roberts, Link’s deputy chief executive, said: “The key thing is that as a result of the new rules, Link will be able to recommend more banking hubs and alongside free ATMs and post offices, access for cash available. protected for many years to come.”
Cat Farrow, chief customer officer, Cash Access UK, said: “We’re delighted to see this commitment to bringing more banking hubs to communities across the UK.”
The Government recently held a banking hubs roundtable meeting with industry leaders, with a commitment to have 230 hubs delivered by the end of 2025 and a further 120 rolled out by the end of Parliament – meaning the country should have a total of 350 banking hubs open Parliament. end of Parliament.
