Tag: cash

Which? urges banks: commit to cash

Which? is urging the UK’s eight largest retail banks to publicly commit to maintaining cash access for the millions of people in the UK who still rely on it, as its latest analysis shows that 13,000 cash machines have disappeared in just three years.

In a letter to the banks, Which? Chief Executive Anabel Hoult outlines how the coronavirus pandemic has exerted enormous pressure on the cash network, and calls for immediate action to safeguard access to cash to ensure that cash remains a viable payment option.

Which? research last week showed that nearly 10 million people are not ready – or able – to give up cash. However, despite legislation being announced to protect cash for these consumers at last year’s Budget, there is still no timetable in place for its introduction.

The delay has seen what was already a fragile system weakened even further, and last week LINK, the UK’s largest cash machine network, warned that unless action was taken the number of ATMs in the UK could halve in the next two years.

The slow pace of progress towards legislation has created a dangerous vacuum, in which cash machine and bank branch closures continue apace with little scrutiny or oversight to ensure the changes meet the needs of consumers as well as business.

While potential alternatives to mitigate these closures have been proposed, such as cashback without purchase from shops, the speed at which they are being developed and rolled out simply is not quick enough to stem the losses to the existing cash network that show no sign of slowing down.

Since the start of 2020, 3,300 free-to-use cash machines have closed across the UK. The overall number of ATMs in the UK has also fallen by 13,000 in the last three years, falling from 67,300 to 54,400.

In order to prevent yet more damage being inflicted as national restrictions continue, the consumer champion has given firms a two-week deadline to confirm that they will continue membership of two vital industry schemes in the interim period until legislation comes into force, with a regulator in place to ensure that it delivers for cash-reliant consumers.

These voluntary schemes are managed by LINK and the Post Office – both of which currently act as vital guard rails for the UK retail banking system, protecting the viability of cash withdrawal and basic banking services for millions of people. If one of the major retail banks were to withdraw their membership, neither would be viable.

This would mean that LINK’s financial inclusion programme, which is designed to improve access to cash for the most vulnerable and deprived communities, would be under threat, while consumers who live in areas where the Post Office is often the only remaining source for accessing cash would be forced to travel much longer distances to withdraw their money.

Research from the Financial Conduct Authority (FCA) last year revealed that during the first national lockdown, cash machine closures had already led to tens of thousands of people being cut off from local access to cash.

While these measures will not address all of the problems with the cash network, they are a critically important step in securing the viability of cash until longer-term solutions are agreed and implemented.

Which? is concerned that it will be extremely difficult to reintroduce access to cash in some communities should these voluntary agreements be undermined before legislation is introduced. The consumer champion is urging firms to recognise that a bank’s individual commercial decisions can have a profound impact on the wider cash ecosystem.

As well as this commitment from banks, Which? is also calling on the government to urgently set out its timetable for legislation, and press ahead with giving the FCA the responsibility to oversee the protection of cash in the UK to ensure that it remains a viable payment option as long as people need it.

Which? will provide an update on how banks have responded to our request for continued membership of these schemes once the deadline has passed.

Anabel Hoult, CEO of Which?, said: “Ensuring some of the most vulnerable members of society have the ability to access and spend the cash they rely on to pay for essential goods and services must be a priority for the government, the financial regulator and banks, not an afterthought.

“While there is no doubt that more people than ever are able to benefit from digital banking, that does not detract from the need to provide reasonable access to cash for the millions who need it.

“It is imperative that banks continue to be part of the existing access schemes in place to ensure that the availability of cash is not left to erode even further while legislation is being passed. The government now needs to clarify its timeline for when new laws will actually be in place to protect access to cash.”

Cash crash?

One in three blocked from paying with notes and coins during pandemic

Which? is calling for urgent action to protect the millions of people who depend on the critically endangered cash network, as new research from the consumer champion shows more than a third of consumers have been blocked from paying with cash since the start of the pandemic.

In a survey of 2,000 people, 34 per cent reported being unable to pay with cash at least once when trying to buy something since March, when coronavirus restrictions were first introduced.

Respondents were most likely to be refused the option of paying in cash when shopping for groceries, which accounted for more than a quarter (28%) of incidents.

This was followed by leisure activities such as going to a pub or restaurant (24%) and buying cleaning products (21%).

In one particularly concerning incident reported to Which?, a diabetic man in urgent need of food because his blood sugar levels had dropped was refused service in two restaurants that had gone cashless because of coronavirus.

The figures are highly concerning given the significant numbers of people that still need cash to pay for essential goods and services, particularly now that the UK is once again under tough coronavirus measures.

Five per cent of respondents said they rely on cash, which equates to more than two and a half million people in the UK. 13 per cent, equivalent to seven million people, also said they would struggle without it.

Taken together, this means that 10 million people are not ready – or able – to give up cash.

Furthermore, 40 per cent, representing 22 million people, said that they viewed cash as an essential backup.

The survey also highlighted how rapidly the coronavirus outbreak has changed the way many people pay.

More than half (53%) of people said they had replaced some or all of their cash use since the first lockdown. Of these, just under half (46%) said that their declining cash use was as a result of shops prohibiting or discouraging it.

The potentially serious consequences of businesses refusing cash have been highlighted by the experience of consumers who have reported their problems to Which?.

In November, James Boswell, who is diabetic, stopped off at a service station in urgent need of food after getting stuck in traffic for several hours on the M25, which meant his blood sugar levels dropped.

Despite explaining his situation, the first food outlet he tried, a Nando’s restaurant, refused to serve him as he only had cash with him. The same happened at another restaurant, El Mexicana, but eventually he was able to pay in cash at KFC.

Which? also heard from Linda Blacker, from Southampton, who was unable to board a Bluestar bus after she attempted to pay with a banknote. This was despite having her foot in a brace on account of a broken ankle, and was on her way to see her GP to get a sick note at the time.

Meanwhile, two in five shoppers (42%) told Which? they were using less cash because they thought card payments were safer, a notion that prompted some businesses to encourage contactless payments or go entirely cash free in response to the pandemic.

This approach was first taken at the start of the pandemic, when there were mixed messages about the safety of cash, but since then the Bank of England has provided clarity on the issue.

It advised during the first lockdown that the risk from banknotes is ‘no greater than touching any other common surface, such as handrails doorknobs or credit cards’, and in November concluded that ‘any risk from handling cash should be low,’ particularly compared with ‘hightouch’ objects such as shopping baskets, self-checkout touchscreens or products for sale.

Given the low level of risk, combined with the significant number of people who still rely on it, Which? is encouraging shops to continue to accept cash to ensure that people, particularly those who are vulnerable, are not left in a position where they have no other way to pay.

The consumer champion is currently working with retailers to develop an initiative to protect consumers who want or need to continue shopping with cash.

Which? welcomes the government’s proposal for the FCA to be given the responsibility to oversee the protection of access to cash in the UK. However, the issue of acceptance must also be addressed.

The consumer champion is also calling on the government to make the regulator responsible for tracking the number of UK businesses accepting cash and at what rate this is changing, in order to determine what action is needed and when.

Failure to do so risks undermining legislation on protecting cash access announced by the government in last year’s budget, and the FCA and government need to work together to ensure cash remains a viable payment option.

Jenny Ross, Which? Money editor, said: “Cash is still a vital way to pay for millions of consumers, so to see such a high proportion of people report that they have had difficulty spending it is very concerning, particularly now we have entered another lockdown.

“We have repeatedly warned about the consequences that coronavirus will have on what was an already fragile cash system, but nowhere near enough action has been taken by the government or the regulator to understand the scale of this issue.

“The government, which is still yet to introduce legislation to protect cash it promised almost a year ago, must urgently make the FCA responsible for tracking cash acceptance levels. Failure to do so will see the cash network crumble and leave millions of people abandoned.”

Government consults on plan to protect future of cash

People will be able to get cashback from shops without needing to buy anything under new proposals to protect the UK’s cash system announced today (15 October 2020).

  • government sets out plans to protect the UK’s future cash system and ensure people have easy access to cash
  • proposals would see cashback offered at shops without consumers having to make a purchase
  • the Financial Conduct Authority would also be given overall responsibility for the UK’s retail cash system to protect consumers and SMEs

Under the government proposals, cashback without a purchase could be widely available from retailers of all sizes in local communities across the UK.

Although cash use is declining, with people increasingly choose cards, mobile and e-wallets to make payments, it remains crucial for groups across the UK – including the elderly and vulnerable. Many find that cash is more accessible than digital payments methods or that it helps them to budget and manage their finances.

These proposals, which also include making the Financial Conduct Authority (FCA) responsible for ensuring the cash system benefits consumers and SMEs, are the latest step in the Government’s effort to support the millions of people and business who rely on cash day to day.

John Glen, Economic Secretary to the Treasury, said: “We know that cash is still really important for consumers and businesses – that’s why we promised to legislate to protect access for everyone who needs it.

“We want to harness the same creative thinking that has driven innovation in digital payments to maintain the UK’s cash system and make sure people can easily access cash in their local area.”

To ensure no one is left behind by the transition to digital payments, the government announced at the March 2020 Budget that it would legislate to protect access to cash and ensure that the UK’s cash infrastructure is sustainable in the long-term.

Today it is seeking views on its approach to this legislation from consumer organisations, businesses, financial institutions, providers of ATM and payment services and others through a call for evidence.

One proposal under consideration is cashback without a purchase, which could help to keep cash widely available by reducing cash infrastructure costs.

When local shops accept and dispense cash, it is recycled through local communities and there is less need to transport and distribute notes and coins via cash centres, which reduces the associated costs.

Last year, consumers received £3.8 billion of cashback when paying for items at a till – making it the second most used method for withdrawing cash in the UK behind ATMs.

Current EU law makes it difficult for businesses to offer cashback when people are not paying for goods and this has been a barrier to widespread adoption. The Government is now considering scrapping these rules once the transition period ends on 31 December 2020.

The government is also considering giving the FCA overall responsibility for maintaining a well-functioning retail cash system given its existing regulatory role and consumer protection objective.

At present, The Bank of England, Financial Conduct Authority, Payment Systems Regulator, and HM Treasury each have specific roles and responsibilities for oversight of the cash system. Close coordination between these authorities has been highly effective, particularly in managing risks to cash through Covid-19, but there may be significant benefits to giving a single authority overall responsibility for setting requirements to meet the cash needs of consumers and SMEs.

The call for evidence opens today (15 October 2020) and will run for six weeks. It will seek views on how to ensure industry continues to offer ways to withdraw and deposit cash, how to improve cashback, what affects cash acceptance, and where regulatory responsibility should sit.

More detail on the government’s proposals is available in the Access to Cash Call for Evidence document.

The Call for evidence will close on 25 November 2020.

Briggs calls for access to cash for vulnerable groups

The National Audit Office (NAO) recently reported that HM Treasury and the public bodies responsible for overseeing the cash system need to work together more effectively to achieve the government’s goal of safeguarding access to cash. A coordinated effort is needed to prevent vulnerable people who rely on cash for transactions from being excluded.

Ten years ago, cash was used in six out of 10 transactions but by 2019 it was used in less than three in 10 transactions. The outbreak of COVID-19 may have accelerated this trend, as data suggests that market demand for notes and coins declined by 71% between early March and mid-April during the lockdown, although demand has since been recovering.

The decline in the use of cash in transactions is putting pressure on the cash system. Commercial operators who distribute cash rely on high demand to maintain the attractiveness of their business models, and cover large fixed costs, such as bank branches and ATMs. In March 2020 the government announced that it would be bringing forward legislation to protect access to cash and address the sustainability of the cash infrastructure.

According to the NAO, the pressures on the cash system could mean that people who rely on cash find it more difficult to use cash in transactions. Published research shows that older people and those on a low income are more likely to make cash transactions.

In the two years to December 2019, there was a 17% reduction in free-to-use ATMs.  LINK3, with support from the Payment Systems Regulator, have protected ATMs in specified areas where provision is limited. 

However, while there remains a higher number of free-to-use ATMs in more deprived areas, in the two years to January 2020 the proportion of free-to-use ATMs has declined faster in those areas than in less deprived areas.

The NAO cannot currently see a clear link between the government’s aim to safeguard the consumer’s ability to use cash, and the responsibilities of the five public bodies in the cash system.

No single body has responsibility for reporting on the performance of the system in meeting the government’s aim.  In May 2019, HM Treasury established the Joint Authorities Cash Strategy Group (JACS) to coordinate work to support nationwide access to cash. Although the group has improved joint working towards government’s aims, JACS does not oversee the cash system and has no decision-making power.

Changes in cash use are having an impact on the production of coins. Coin production shrank by 65% in the last decade to 383 million UK coins a year in 2019-20, from around 1.1 billion in 2010-11.

When the Royal Mint (the Mint) replaced the old £1 coin in 2017, the public returned large volumes of all coin denominations. As a result, the Royal Mint’s stocks exceeded targets in all denominations.

At the time of the NAO’s fieldwork, the Mint had no plans to produce new 2p or £2 coins for at least ten years. To drive efficiencies, the Mint has reduced headcount by 22% on coin-making work within its currency division and scrapped two of its six plating lines.

Despite fewer people using cash for transactions, the demand for notes has continued to increase.

In 2020, the number of notes in circulation reached a record high of 4.4 billion, with a value of £76.5 billion. In 2018, the Bank of England (the Bank) estimated that only 20%–24% of the value of notes in circulation were being used or held for cash transactions, with UK households holding a further 5% as savings.

Little is known about the remainder, worth approximately £50 billion, but possible explanations include holdings overseas for transactions or savings and possibly holdings in the UK of unreported domestic savings, or for use in the shadow economy. The Bank and other government bodies have little reliable information to quantify how much is likely to be held where.

At March 2020 the Bank’s contingency holding of notes significantly exceeded its minimum guidance levels, which was partly affected by the launch of the new £20 note. Its contingency stock levels were above minimum levels for all denominations, with a total value of £39 billion, against its minimum contingency guidance level of £20.5 billion.

The Bank considered these stock levels to be appropriate in light of the transition of the £20 note to polymer. However, it is not clear from the documentation shown to the NAO what process the Bank operated to determine adequate stock levels, and how the cost implications of building stock levels were taken into account.

Recent anti-counterfeiting work by both the Bank and the Mint is delivering improvements.  Indications so far are that £5 and £10 polymer notes, with new security technology, have reduced the incidence of counterfeiting compared to equivalent paper notes. In addition, since the Mint introduced new advanced security technology, surveys have found very low counterfeiting rates for the new £1 coin and other denominations.

The NAO recommends that HM Treasury should set out more clearly the specific outcomes it wants the cash system to deliver for consumers and small businesses, and how this should be balanced against costs.

To drive efficiency, the Mint and the Bank should maximise opportunities to learn from each other’s experiences of cash production and align production capacity closely to future needs.

Gareth Davies, head of the NAO, said: “As society progresses towards the wide use of digital payments, the use of cash in transactions is dwindling. It may become harder for people to access cash when they need it and those without the means to pay digitally will struggle if cash is not accepted.

“HM Treasury now works more closely with the public bodies in the cash system to achieve the government’s goal of safeguarding access to cash. However, the approach is fragmented, and it is not clear that the action being taken will keep up with the pace of change.”

Lothian MSP, Miles Briggs, said: “Edinburgh and the Lothians have been moving away from cash over the last decade, but there are many people who still rely on using cash.

“The Covid-19 pandemic has accelerated the use of contactless payments which is not convenient for everyone.

“The UK and Scottish Government must work together to ensure that  people who prefer using cash to manage their money have easy access to it.”

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Cashing Out: urgent action needed to protect payment lifeline

Vulnerable people risk being left with no way to pay for essential products and services as the coronavirus crisis further accelerates the UK’s shift to a cashless society, new Which? research reveals. The consumer organisation is calling for government action to ensure that the cash system does not collapse at a time when millions of people still rely on it. 

A survey by the consumer champion found that half (51%) of those looking after the finances or grocery shopping of someone else had been paid in cash in return for doing shopping, highlighting its continued importance in communities across the country and the huge challenge that a cashless society presents for those who are not yet ready or able to make digital payments.

As consumers are also experiencing difficulties paying with as well as taking out cash, Which? is pressing for action from the government and financial regulators to ensure millions of people aren’t left abandoned as a result of the outbreak that’s put additional pressure on the UK’s already fragile cash network.

The Which? study of more than 2,000 people, conducted at the start of May, reveals that nearly one in five reported that they were managing finances or ordering food and essentials for someone outside of their immediate household.

Of those, 32 per cent had bought food from a shop for others and been paid for it in cash, and 29 per cent had ordered for someone online and been paid for it with cash – while some responded that they had done both.

Which? has heard of numerous cases where cash is essential for this sort of help, including one person who is reimbursed in cash for delivering supplies to their vulnerable 91-year-old uncle, and another who shops for neighbours twice a week – after cash and a shopping list have been posted through their door.

The research also highlighted that one in 10 people were refused by shops when trying to pay for items with cash, at a time when only those that were permitted to sell essential goods were open. A quarter of those were left unable to purchase the item in question on at least one occasion as they had no alternative means of payment.

And while nearly one in three people reported still using cash to make some or all of their payments, seven per cent said they had found it more difficult to take out cash since the outbreak began.

With many retailers now encouraging non-cash payments and banks reducing branch opening hours, Which? supports schemes introduced by banks and businesses to provide access or alternatives to cash during this crisis.

However, it remains unclear how effective these have been at addressing the root of the problem. It believes these are unlikely to be a viable long-term fix, and that cash-dependent consumers could be left completely excluded from engaging with the economy if cash is not urgently protected.

Despite the clear need for cash, the coronavirus pandemic has pushed the cash system that millions of people still rely on into deeper peril, just months after the government vowed to protect it.

In March, the government committed to legislating to protect access to cash for as long as people need it, after warnings that the system could collapse within two years. This followed investigations from Which? that found the UK had lost a staggering 10,500 free-to-use cash machines since 2017, and over a third of bank branches in less than five years.

However, the coronavirus pandemic has drastically reduced the timeframe for intervention, and the government’s pledge risks becoming obsolete if current trends continue to go unchallenged, which risks cutting off millions of people from the main form of payment they rely on to purchase essential products and services.

Coronavirus has rapidly accelerated the decline in cash use. Latest figures from Notemachine, one of the UK’s largest ATM operators, show that cash withdrawals have reduced by 45 per cent since lockdown began – although the average value withdrawn has increased by 13 per cent.

And while figures from Link, which manages the UK’s largest cashpoint network, show that approximately £1 billion is still being withdrawn from ATMs every week, it says the overall decline means that the current level of cash usage is now at a level that was not expected for five years.

As well as urgently introducing the legislation it committed to in the budget, Which? is calling on the government to take all necessary steps to ensure people can continue to use cash to pay for essential goods and services during the coronavirus pandemic.

This includes providing support for businesses to accept cash and offering clear guidance on how to handle banknotes and coins safely.

It also believes the FCA must collect and publish information about emergency measures that individual banks have put in place, including an assessment of their long-term suitability and effectiveness.

Which?’s proposals have been backed by a diverse group of organisations that all share its concerns about the implications of the rapid decline of cash availability and acceptance. These include the Access to Cash Review – led by Natalie Ceeney, Age UK, the RSA, Independent Age, Alzheimer’s Society and Link.

Gareth Shaw, Head of Money at Which?, said: “The coronavirus outbreak has shown that cash remains vital to many consumers, particularly for vulnerable people who rely on it to pay for essential supplies. 

“As a result, it’s vital that the already fragile cash system is not left to collapse completely as the UK’s shift to a cashless society accelerates.

“The government must urgently press ahead with the legislation it has already committed to before it becomes obsolete, as failure to do so risks excluding millions of people from engaging in the economy.”

Couples jilted at altar by wedding venues cancelling big day – and pocketing their cash

Wedding venues are potentially breaking the law by exploiting unfair terms and conditions to avoid refunding couples for cancellations due to coronavirus, a new Which? investigation reveals.

Many frustrated couples have contacted Which? as they are struggling to get refunds, often worth tens of thousands of pounds, from venues for weddings cancelled or postponed due to the coronavirus crisis, in line with the government’s March 23 ban on large gatherings for weddings.

Of the 25 couples Which? has spoken to, 20 said their wedding venue refused to offer a refund or made the process for obtaining a refund difficult. A similar proportion said they had not been offered like-for-like dates or offered a refund if the price for the postponed date was cheaper. 17 couples said their venue has charged a fee to rebook or cancel their wedding and 15 couples said their venue has introduced new terms and conditions.

The consumer champion is reporting 12 wedding venues and organisers to the Competition and Markets Authority (CMA). It analysed the contracts of eight venues that had potentially unfair terms and conditions and heard from a further four couples whose venues were potentially breaching the regulator’s guidance on refunds and cancellations, which was issued last month after the CMA announced it was investigating this sector.

The CMA also outlined its expectations for businesses, in most cases, to refund customers if they cancel or cannot receive a service due to Government public health measures, including any non-refundable deposits or advance payments. It expects businesses to waive any admin fees for processing refunds too.

Which? received most complaints about the Bijou Weddings group, a family-run wedding venue chain. Some of the couples that had booked with Bijou said the venue told them just before the government announced a ban on weddings that not only had their weddings been cancelled, but that they were liable to pay a cancellation fee of 80 per cent of the total cost of their weddings.

In May, a number of Bijou customers reported new contract terms had appeared on the website, stating that couples could postpone if their original date was not possible due to the coronavirus pandemic, but with no reference to a refund. This would be in breach of the CMA’s guidance that states rebooking should not be offered instead of refunds.

Bijou told Which? the new contract uploaded to the site was a blank template and appeared due to an IT error. Which? has seen the new terms that appeared on the site after some couples were able to take a screenshot of the contract before it was removed.

By law, new terms and conditions must be fair and can be unenforceable if they give too much power to the business providing the service. Which? analysed the new and pre-existing terms and conditions from a number of wedding venues, including Bijou, and found some that could be seen as unfair and unenforceable as they significantly reduce customers’ rights.

Which? has also heard from Bijou customers who said the venue suggested they claim with their insurer to avoid refunding customers for cancelled weddings.

Claudia had booked her wedding at Bijou’s Botleys Mansion venue. When the venue cancelled and asked for an 80% cancellation fee, it suggested she claimed the money back from her insurer and used the money to rebook. Most insurers have refused to pay out for cancellations, so Claudia risked being left out of pocket and with no idea if or when she would be able to get her money back.

Most wedding insurers had stopped selling new policies by mid-March following a surge in demand. However, those with existing policies have found themselves caught between venues that refuse to pay out and insurers with unclear policies or “exclusion clauses” which mean they do not have to pay out either.

Another couple, Marcus and Georgina, said they had endured a “torturous” experience with the company. They were disappointed when Bijou’s Botleys Mansion refused to refund the price difference after their weekend wedding in June was postponed to a weekday. The venue insisted the CMA’s guidance would not entitle them to reimbursement if a like-for-like replacement is not available.

Emily and Louie, who had paid over £20,000 for their wedding at Bijou’s Cain Manor, said they “could not express the stress and heartbreak” caused by the venue who have not offered a like-for-like new date and refused to refund the difference.

Which? believes these complaints are just the tip of the iceberg and there could be an industry-wide issue when it comes to refunds and cancellations.

As well as two Bijou Weddings venues, Which? has shared information with the CMA on 10 other wedding venues who have potentially unfair terms and conditions or have potentially breached the regulator’s guidance, including Tournerbury Woods Estate in Hampshire.

The Hampshire-based venue claimed one couple would forfeit their fee if they wanted to rebook their cancelled May wedding for the same time next year. The couple has now been offered a refund, but only after weeks of trying to arrive at a solution.

Adam French, Which? Consumer Rights Expert, said: “We believe there may be a serious, industry-wide issue with wedding venues ducking their legal responsibilities on refunds and cancellations by using potentially unfair terms and conditions.

“While many wedding venues may have been financially impacted by the coronavirus crisis, couples who are likely to be devastated at having to cancel their big day should not be forced to bear the cost.

“The CMA is currently investigating this sector and must be ready to take firm action against venues found to be breaching consumer law so customers have some prospect of getting their money back.”

Bijou Group said: “We have been doing everything we can to navigate these very challenging times with as little disruption as possible to our couples and their big days, which we have been working on planning with them for up to two years, incurring significant costs along the way.

“The huge majority are very appreciative and understanding but there is unfortunately a very small minority (around eight or nine) who are not entirely satisfied and have taken to press, social media, review sites, solicitors and so on in an attempt to get what they want. We are considering every case, at length, individually to understand what we can do to help but must also be consistent and fair.

“Without cancellation charges like these, the industry would not be able to offer to consumers what it does at the prices that it does. The cancellation charges protect the venues, and there is wedding insurance to protect the couple.

“We did not cancel any weddings voluntarily – it was imposed on us – and this is exactly the situation for which wedding insurance exists.”

It told Which? Thursday-Sunday postponement dates were one of many options offered to couples.

Tournerbury Woods Estate said: “We have used our best endeavours to try and accommodate each of the couples’ varying needs and requirements to help with postponing their big day, to a day next year when we all hope the Covid 19 crisis will be over.

“Fortunately, we have managed to find a fairly swift and workable solution for the majority of the couples that have had to postpone their weddings.”

Post Office helps self-isolating people to access cash

The Post Office is making two of its products available to all UK banks, building societies and credit unions, to make it easier for people who are self-isolating to access cash.

The products are Payout Now – a voucher sent by text, email or post to a customer who can share it with a trusted person to withdraw cash; and Fast Pace – a service allowing a customer to arrange for a trusted person to collect a cheque from them, cash it at Post Office and return with the money.

Martin Kearsley, banking director at the Post Office, said: “Being able to easily access cash is a vital service for older people and those self-isolating.

“Our Payout Now and Fast Pace services mean they can access cash quickly and securely to repay someone for a helpful service like shopping, or simply manage their finances, providing peace of mind that cash can be securely sourced with the help of any trusted helper.”

Gareth Shaw, Head of Money at Which?, said: “Millions of people rely on cash every day but many will struggle to access their money during the coronavirus crisis.

“Our research has found a third of people, including those aged 65 and over and vulnerable consumers, have concerns about managing their money digitally, so this initiative will ensure those who rely on cash will not be cut off during this difficult time.

“Initiatives like this also highlight how close to collapse the UK’s cash network is and further drives home the need for swift action to guarantee access to cash over the long-term.”

The Post Office has a UK network of more than 11,500 branches.

A Digital Economy? Not Cashless, But Less Cash

Big Tech must open up data and help fund digital inclusion as UK economy moves away from cash in 2020s, says IPPR

  • New competition powers should compel big digital firms to share their data if they enter personal finance market – to prevent market domination and promote innovation
  • As UK heads to a ‘less cash, but not cashless’ digital economy, UK must step up investment in digital skills and connectivity to meet new inclusion targets

In a comprehensive review of the future of UK payments, the think tank IPPR has set out how the transition to a ‘less cash’, but not cashless, digital economy can be managed to protect the vulnerable and spread digital opportunities widely and fairly.

The digital transition is already happening fast. While in 2008 60 per cent of UK consumer payments were made in cash, this had fallen to just 28 per cent in 2018. The IPPR report cites forecasts that by 2028 fewer than one in 10 payments will be made in cash.

The digital revolution in finance means a shift to a considerably less cash-based digital economy, but the prospect of a fully cashless UK is not on the horizon, argues IPPR. This shift is expected to boost UK productivity and create opportunities for business and consumers, but there is a significant risk that people and areas reliant on cash may be excluded.

Giant tech firms such as Facebook and Amazon are already starting to offer more personal financial services, alongside traditional banks, but the control they could have over huge amounts of people’s data poses significant risks.

The IPPR report argues that as cash use continues to fall and digital payments break new ground, it is critical that policymakers take action to shape the future of UK payments.

To deliver a future that is both more digital and more just, IPPR recommends:

  • Major platforms such as Facebook and Amazon should be required to open up their data upon entry into the personal finance market. New powers should enable the Competition and Markets Authority (CMA) to impose conditions on market entry for major platforms, including requirement to comply with Open Banking principles and open-source technology. These should include an option to block market entry, including for major technology platforms, where it could lead to consumer detriment, slowing in innovation rates, or excessive market power.
  • Democratising data – Anonymised personal banking and financial service data should be held in a new public data trust, ‘Digital Britain’. This will strengthen competition, promote innovation and prevent monopolistic tech giants dominating the market.
  • Digital Transition Levy worth billions of pounds a year – Reforming the Banking Levy on banks and financial service providers to fund the delivery of digital inclusion schemes against new digital inclusion targets – boosting internet connectivity, strengthening digital skills and fostering innovation that will help people overcome the barriers to the digital economy. The new levy combined with new targets would mean that those who stand to gain most from the digital transition will have some of their gains reinvested in communities that risk being left behind.
  • Bridging the digital divide – More than 8 million UK adults still rely on cash and one in five people do not yet have the digital skills they need to access the digital economy. New targets and investment should be put in place to protect cash access for those who rely on it and to narrow the digital divide across the UK.
  • Protecting long-term access to cash – Between 2017 and 2018 6,243 cash machines have been closed – a 9 per cent drop in a single year. While there are still more UK ATMs in operation than at any point before 2006, this recent rate of decline is a cause for concern. To stem the decline of free-to-use ATMs, business rate rebates should be offered to operators who provide them, and retailers should be incentivised to roll out free cashback services.
  • Creating a new Post Bank – Between January 2015 and August 2019, 3,312 bank and building society branches closed in the UK, equivalent to 55 closures a month. The UK Treasury should oversee the creation of a publicly owned Post Bank with a public service mandate to provide basic banking services to all citizens. It would operate via the existing Post Office network and help ensure the future viability of the Post Office.
  • Championing digital self-employment – The government should develop a digital platform for self-employed workers, so they can better manage payments, streamline tax accounting and apply social security provision. This will not only save them time and boost tax revenues, but also help tackle fraud and financial crime by bringing the informal economy into the system.

IPPR argues that these proposals, amongst others in the report, will deliver a path to a digital economy that delivers not just greater prosperity, but greater economic justice: where more people can access better payments and banking services, data is harnessed for the public good and the most vulnerable people are protected.

The report notes that an increasingly digital economy brings faster payments, more personalised services and greater convenience for digital users. However, if these benefits are only available to digitally savvy people – typically younger people and those with higher incomes – inequality could be embedded into the future of finance, it warns.

IPPR urges the government to seize this moment to prevent all the gains from digitisation flowing to big tech firms and big finance and instead deliver excellent financial services for all, a competitive innovative personal finance market and democratic control of data.

Rachel Statham, IPPR Economic Analyst and lead report author, said: “The future will have less cash. But urgent action is needed to set the UK on course towards an economy that is both more digital and more just.

“By getting ahead now, we can invest the billions needed to get every part of the country ready for a more digital future and protect access to cash where people rely on it. This could see the potential benefits brought by a move away from cash invested to narrow rather than widen inequalities, handing control over from Big Tech and banks to people and communities.

“The move away from cash should only happen as fast as people are ready for, and the benefits of doing so should be shared. By setting new digital inclusion targets at the national, regional and local level, and investing to meet these targets, we can make sure bridge the digital divide and protect cash for those rely on it.”

Carys Roberts, head of the Centre for Economic Justice and IPPR Chief Economist, said: “There are opportunities within reach as the UK economy shifts away from cash and towards digital payments – from productivity increases to preventing fraud and financial crime.

“But there’s also a danger that the shift to digital, if not proactively shaped, will work for some and leave many behind. The government should enable everyone to take part in the digital economy and ensure powerful companies like Apple and Google play their full part in shaping a fairer move away from cash in the UK.”

Jenny Ross, Which? Money Editor, said: “While digital payments have brought great benefit to countless consumers, it is crucial that a balance is found that also protects cash for all those reliant on it – instead of stripping people of this vital payment method.

“With the cash landscape on the verge of collapse, it’s clear that industry alone cannot be relied upon to guarantee withdrawals – so the government and payments regulator must quickly step in with a plan to protect cash against the sweeping tide of bank branch and cashpoint closures.

“Ultimately, the government should legislate to give consumers confidence that they can access cash for as long as it is needed.”

Rapid changes to cash landscape risk leaving millions behind, says Which?

Which? is calling on the Government to appoint a regulator to protect access to cash, as a combination of bank branch and cashpoint closures risks leaving people struggling to pay for essential goods and services. Continue reading Rapid changes to cash landscape risk leaving millions behind, says Which?

New £50 note is’cash fit for the future’

  • Treasury confirms £50 note will continue to be part of the UK currency
  • Bank of England announces it will make a new modern polymer note
  • more secure note will help clamp down on crime

Modern money will help prevent crime, the Exchequer Secretary has declared as plans were unveiled for a new, more secure £50 note. Continue reading New £50 note is’cash fit for the future’