Campaign group Action to Cash Review has warned incoming Chancellor Rishi Sunak that the abandonment of cash as a means of payment could scupper the economy and leave many sections of society financially isolated.
The move came as the group revealed data that indicates less than 10% of transactions will be made in cash by 2030, with calls for the government to legislate to ensure that people will always have access to paper money, especially outside of the cash ATM system. For example, it’s currently illegal for shops to offer ‘cash back’ if no purchase has been made.
Speaking to BBC News Access to Cash Review’s Natalie Ceeney said: “We must ensure the shift to digital doesn’t leave millions behind or put our economy at risk… The UK is fast becoming a cashless society – without knowing what this really means for consumers or for the UK economy.”
Figures highlighted earlier this month by Which? show the amount paid by consumers to withdraw cash jumped by £29m to £104m last year – as many free machines vanished or were converted to charge fees.
In contrast, this seismic shift in the cashpoint network has saved the banks £120m since January 2018, according to data from Link, which runs the UK’s largest cashpoint network.
More than 8,700 free ATMs have closed since changes to how the Link cashpoint network is funded were pushed through with no regulatory oversight in January 2018, following lobbying by the banks.
Between 2018 and 2019 the percentage of fee-charging machines jumped by 37 per cent (from 11,120 to 15,277) and they now comprise a quarter (25%) of the entire network of 60,291 machines – leaving countless communities having to pay up to £2 just to withdraw their money.
These changes have seen the number of times people have had to pay to withdraw cash increase from 46m in 2018 to 73m in 2019 – a rise of 59 per cent in a single year.
The banks are also saving vast sums through branch closures – with 1,203 having closed since January 2018 alone. These ongoing closures have drastically reduced people’s ability to access free withdrawals across the UK.
The independent Access to Cash Review was established to consider consumer requirements for cash over the next five to fifteen years.
It says its main objective is to ensure that there remains an effective and inclusive cash access service that meets the needs of all consumers, regardless of their personal circumstances, for as long as necessary.