Legislation Protecting Cash Could be 'Transformative' for UK High Streets
Natalie Ceeney—author of the UK’s Access to Cash Review—says the rapid introduction of laws to safeguard cash could be ‘transformative’, offering consumers and businesses new ways to withdraw and deposit cash, through community banks, free cashback services in small shops, and nationwide cash deposit schemes.
‘The result could be better cash access in a more sustainable way,’ notes Ceeney, Chair of Innovate Finance. On a cautionary note, she warns that, should the Government move too slowly, ‘local communities would die.’
Ceeney’s authoritative report, delivered in March 2019, revealed eight million people would struggle to cope in a cashless society, and hers is not a lone voice. Consumer groups and campaigners have also petitioned the Government to legislate to protect cash.
Coronavirus has pushed an already fragile cash system to the brink of collapse. Proposals such as cashback without purchase have the potential to make a significant difference in communities that have seen their access to cash cut by widespread closures to ATMs and bank branches.
While a recent survey by international research group YouGov suggests 50 percent of Britons are using fewer notes and coins since the Coronavirus pandemic began, it also noted payment habits had not changed for eight percent, who are still using cash. Furthermore, 47 percent felt an entirely cashless society would be a bad thing, while only 26 percent viewed the prospect positively. For those who want payment choice, and the minority for whom cash is their only option, it is important to improve access to cash, and ensure it is accepted.
On this site, we recently covered news of people across the UK who have been left unable to buy essentials by local shops going cashless.
For some, cash is a key budgeting tool; for others, it is more accessible than digital payments, or a sign of independence. It is vital these people—many elderly or vulnerable—are not left behind.
The Government has already laid out plans to protect cash, which include retailers offering cashback without a customer needing to make a purchase. The current cashback rules are determined by the European Union, and could thus be changed once the UK’s transition period out of the EU concludes on 31 December 2020.
Other aspects of safeguarding cash include ensuring communities have additional banking services—such as free-to-use cash machines—and greater promotion of free-to-use cash services. These could be via an app that would assist consumers with locating their nearest cash access point, and providers of fee-charging cash machines being required to display the location of the nearest free alternative.
Ceeney also believes banks should be required to fund the installation of automated deposit machines in supermarkets and post offices, fearing that, without regulatory intervention, more businesses may decide to go cashless. She says, with proper planning, everyone will win, but ‘sleepwalking into a cashless society will leave millions behind.’
Protecting access to cash presents complex economic challenges, but it remains a key Government priority.