HMT call for evidence: Access to Cash - Which? response

Which? response to HM Treasury Access to Cash: Call For Evidence.

Summary:

• Which? welcomes the opportunity to respond to HM Treasury’s call for evidence. Legislation to protect access to cash is vital for the millions of people who would struggle to cope in a cashless society.
• Legislation must be introduced swiftly to prevent the cash system from collapsing altogether. HM Treasury should publish a timetable of the introduction of legislation to Parliament.
• Our view is that legislation should give the FCA overall responsibility for setting requirements to ensure the retail distribution of cash meets the needs of consumers. Legislation should require the FCA to design and implement a regulatory framework, funded by industry, through which access to cash can be maintained for as long as it is needed.
• The Government will need to ensure that the FCA has the right powers and resources to effectively regulate access to cash. Key actors in the cash network, such as the Post Office and independent ATM deployers (IADs), currently sit outside the FCA’s perimeter. The Government should also consider whether the FCA will need to be given new regulatory powers to effectively carry out its role as the single regulator.
• For cash-reliant consumers, the ability to pay for essential goods and services using cash is just as important as being able to withdraw it. Our research found that 10% of consumers had been unable to pay for items with cash during the first national lockdown because it was refused by the retailer. Worryingly, a quarter (26%) of these people were on at least one occasion unable to purchase the item in question as they had no alternative means of payment.
• As part of providing FCA with an overall responsibility for maintaining a well-functioning retail cash distribution network, Which? is calling on the Government to give the FCA the responsibility for tracking and publishing changes in cash acceptance levels across the UK. The FCA should also conduct an assessment of the impact of cash refusal on consumers, particularly those without access to another payment option.
• It is important that merchants have the right incentives to continue accepting cash. Regulation should support and encourage innovation in deposit-taking facilities. Furthermore, the FCA should seek to develop an understanding of the wider factors which may influence merchant’s decisions to accept cash.