Despite the decline in the usage of notes and coins, the finance ministry said on Thursday that virtually everyone in the UK will be within three miles (4.8 km) of a cash machine that does not charge fees.
The ministry said banks and building societies would be given “minimum expectations” to protect services for people and businesses wanting to withdraw or deposit cash, and they may be penalised if they are not satisfied.
Cash as a percentage of total payments has declined from 62% in 2006 to 15% in 2021 and is expected to shrink to 6% by 2031, according to UK Finance’s payment markets study, as the COVID-19 pandemic has pushed the use of cards and smartphones for contactless payments.
UK Ensures Financial Inclusion With New Law Granting Access To Fee-Free Cash Machines
Credit: The Guardian
Britain’s plans for a hypothetical digital pound have also raised concerns that the currency may be further marginalised. While notes and coins are still second behind cards, which account for 57% of transactions, residents in rural regions are concerned that they may be forced to rely on cash machines, which charge a fee for each withdrawal.
“Whilst the growing choice and convenience of digital payments is great, cash has an important and continuing role to play,” said Britain’s financial services minister Andrew Griffith.
According to the government, the Financial Conduct Authority has been given powers under Britain’s recently adopted Financial Services and Markets Act to ensure cash access without fees for people with a bank account.
Credit: BBC
If the bank withdraws a service and a replacement service is required, the ministry said it should be implemented before the closure.
“These are measures that benefit everyone who uses cash, but especially those who live in rural areas, the elderly, and those with disabilities,” Griffith explained.
According to the FCA, 97.5% of consumers living in metropolitan areas can use cash deposit and withdrawal services within a mile. However, this drops to 72.6% in rural regions and climbs to 98.5% within three miles (4.8 km).
Credit: Reuters
The FCA should use its authority to maintain this level of coverage while acknowledging that demands vary by place and evolve, according to the ministry.
As the United Kingdom takes the courageous step of establishing fee-free cash machine use as a legal entitlement, it sets a precedent for other countries battling with comparable concerns of financial inclusion and access to basic services.
This action demonstrates the government’s commitment to tackling economic gaps and emphasises the need to develop innovative solutions that combine technological progress with the needs of all citizens.
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Source: vtt.edu.vn