The Financial Conduct Authority and the Payment Systems Regulator have come together in a move to protect access to cash, particularly for cash reliant vulnerable consumers.
In a speech yesterday (May 13) at Which? Cash Summit 2.0, FCA board member and executive director of consumers and competition, Sheldon Mills, highlighted the importance of legislation to protect cash, urging firms and the wider industry to play a role.
He said: “We expect individual firms to protect the ability of their customers to access cash and other services that meet their needs when they close branches.
“We must work together to protect the ability of consumers and businesses to access cash and banking services.
"The FCA and the PSR will continue to work in an open and transparent way with consumer bodies and the firms we regulate to achieve our desired outcome, including using the full range of regulatory tools available to us where we need to.”
In the FCA’s Financial Lives Survey in 2020, it found that 5m adults used cash for most of their purchases.
The pandemic has led to more people becoming familiar with contactless card payments and internet shopping.
Across 2020, the FCA said cash withdrawals saw a fall of 40 per cent year-on-year.
In a statement published on its website yesterday (May 13), it said it was committed to ensuring that cash, and the infrastructure that supports it, remains available for those who need it.
It said: “The overall decline in the use of cash makes it more expensive to maintain the existing infrastructure that supports it. However, as we move out of the pandemic, cash continues to serve a socially useful purpose for many communities.
“Although our data shows that most people can access cash easily now, there is a need to maintain access to cash and banking services for those that still need it, particularly vulnerable consumers. At the same time, a critical part of maintaining this access will be supporting others that can to transition to digital and other alternative ways of banking and making payments.
“This challenge requires industry, government and regulators to act. We are monitoring trends and supervising firms to make sure access is available and we will use the tools at our disposal to ensure this happens.”
The government had pledged in its 2020 Budget that it would introduce laws to make sure people can continue to access cash.
It said it would begin talks with industry and regulators immediately after the budget.
The FCA said it supports the government’s commitment to protect access to cash through legislation and would have a role in supervising that legislation.
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