The Association of Convenience Stores, British Retail Consortium, Federation of Small Businesses, Positive Money and Responsible Finance are urging the Chancellor to use next week’s Budget to secure long-term access to cash across the UK.
16 Conservative MPs have supported action on access to cash in a private letter to the Chancellor submitted today (Thursday). The letter outlines that to secure long-term access to cash, the Chancellor should use his Budget to:
• Reverse the cuts to interchange fees paid by banks to fund the network
• Exempt free-to-use ATMs from business rates bills
• Recognise that ATMs are the only infrastructure through which to guarantee national access to cash
ATM closures and big banks leaving communities behind are threatening the future of cash. Research commissioned by the Payment Systems Regulator shows that ‘the majority of consumers use cash regularly’ while the Access to Cash Review has found that eight million adults would struggle to cope in a cashless society.
LINK, the ATM network body, is required by the Payment Systems Regulator to ensure the ongoing availability of access to free-to-use ATMs for consumers across the country. However, LINK’s own data shows over 500 free-to-use ATMs are closing every month and one-in-ten areas no longer have free access to cash via an ATM despite LINK’s commitments under the Financial Inclusion Programme.
ACS chief executive James Lowman said: “We acknowledge the growth in digital payments but access to cash remains crucial for the millions who still rely on it for essential purchases. We need a planned approach to changing payment methods instead of the haphazard removal of free to use ATMs from communities.
“Cash back is not a workable replacement for the whole ATM network and comes with costs and security risks for businesses. We need the Chancellor to take action at the Budget to reverse cuts to interchange fees and exempt free to use ATMs from business rates that are making them unsustainable for ATM operators and local shops to host.”
British Retail Consortium Head of Payments Policy Andrew Cregan said: “Cash accounts for almost 40% of retail transactions and is important to many vulnerable people, especially as a tool for budgeting and control. Government should safeguard consumers’ access to cash by ensuring retailers are fairly rewarded for providing cashback services to customers and protecting the viability of free-to-use ATMs.”
Federation of Small Businesses National Chairman Mike Cherry said: “Cash is the payment method of choice for millions of small business customers, and millions more see it as an important part of the payments mix. There are some straightforward steps that the Chancellor can take on Wednesday to bolster our rapidly declining cash infrastructure. Removing business rates on free-to-use cash points is a good starting point. This a prime example of the many stifling quirks that exist within the archaic rates system. Equally, if the Treasury wants more small businesses to offer cashback, it must ensure they are given sufficient financial support to take that on.”
Positive Money Executive Director Fran Boait said: “After being bailed out by the public, banks have repaid the favour by slashing support for free ATMs, making us pay to access our own money. The Chancellor must stand up to banks’ cost-cutting in the Budget and make sure it is them and not the public who pay for Britain’s cash machine network.”
Responsible Finance Chief Executive Theodora Hadjimichael said: “The perils of relying on a single payment method have been illustrated by the weaknesses of digitalised financial systems, and the rapidly decreasing availability of free-to-use cash machines leaves million of people struggling to make payments, including the elderly and vulnerable. Paying for access to cash can compound the poverty premium for low-income families who rely on cash for their day to day budgeting and spending. It is critical that the Chancellor acts now to secure long-term access to cash across the UK.”
Sir Peter Bottomley, MP for Worthing West and Father of the House, said: “Ordinary people need access to cash, local shops want to be able to accept money. We all have a responsibility to stop short term ‘efficiency’ interfering in local trade for local benefits”.
Stephen Crabb, MP for Preseli Pembrokeshire, said: “In many rural areas cash machines have been disappearing at an alarming rate despite the fact that lots of people still prefer to use cash. Many small businesses have yet to make the move to contactless or digital payments because mobile and internet coverage is so weak in rural areas. There is a danger of cash deserts emerging in areas where there are no ATMs or bank branches. I hope the Chancellor and his team at the Treasury consider what steps need to be taken to address these trends”.
Peter Gibson, MP for Darlington, said: “Access to cash is an important one for many of my constituents in Darlington”.
Simon Hoare, MP for North Dorset, said: “While it’s true more transactions are taking place that are cashless, the need for cash, and access to it, continues. Rural areas with less than ideal digital connectivity, older people and small businesses need reliable access to cash. Our call to the Chancellor is to use the Budget as a tool to ensure equality of opportunity for access to cash across the UK”.
Rt Hon David Mundell, MP for Dumfriesshire, Clydesdale and Tweeddale, said: “In a largely rural area like Dumfriesshire, Clydesdale and Tweeddale access to cash is essential for individuals, families and businesses. A reduction in the number of dispensers has caused real hardship and added expense because of the distance some of my constituents have to travel to reach a machine. In some cases they then face transaction charges to access their own money. All this has happened at a time when bank branches have been closed — along with their own dispensers. I fully support calls for Government intervention to encourage a reliable free-to-use national network of cash machines. This is a vital public service and the Budget would provide an early opportunity to help get something done.”