Despite the declining use of notes and coins, almost everyone in Britain will continue to live within three miles of a free ATM, the finance ministry announced on Thursday.
According to the ministry, banks and building societies will be assigned “minimum expectations” to preserve services for individuals and organizations wishing to withdraw or deposit cash and may be subject to fines if they do not meet them.
As the COVID-19 pandemic boosted the use of cards and smartphones for contactless payments, cash as a percentage of total payments has decreased from 62% in 2006 to barely 15% in 2021 and is predicted to plummet to 6% by 2031, according to UK Finance’s payment markets study.
Concerns about the growing marginalization of currency have also been stoked by Britain’s preparations for a hypothetical digital pound.
People who live in remote areas are concerned that when banks close branches and more people bank online, they will have to rely on cash machines that charge a fee for each withdrawal, even if notes and coins still come in second to cards, which account for 57% of transactions.
In a statement, Britain’s financial service minister, Andrew Griffin, said, “Whilst the growing choice and convenience of digital payments is great, cash has an important and continuing role to play.”
The Financial Conduct Authority has been given authority under Britain’s recently enacted financial services and markets legislation to safeguard fee-free cash access for consumers with bank accounts, the ministry reported.
The ministry said if a replacement service is required when banks withdraw a service, it should be implemented in advance of the shutdown.
Griffith said, “These are measures which benefit everyone who uses cash but particularly those living in rural areas, the elderly and those with disabilities.”
In metropolitan areas, 97.5% of residents can access cash deposit and withdrawal services within a mile, according to the FCA, while in rural areas, this number drops to 72.6% and rises to 98.5% within three miles.
The ministry said, While understanding that demands may vary by area and evolve over time, the FCA should exercise its authority to maintain this level of coverage.
