Proposals to protect and widen access to cash ‘could go further’

A recent Financial Conduct Authority consultation has been looking at ensuring access to cash is preserved, but the FSB is calling for further measures.

The Federation of Small Businesses (FSB) believes that while in support of the FCA’s proposals, which include developing a more comprehensive cash assessment process that is more responsive to a wider range of local needs, and publishing assessment outcomes and making processes transparent; they do not go far enough in maintaining SME freedom to choose cash as a form of payment, which they see as inseparable from the broader cash services ecosystem.

Martin McTague, FSB’s National Chair, explained, “A small business must be free to choose which payment options it wishes to accept, including cash. To enable this, it’s vital for the infrastructure required for cash to remain available in all areas.

“Cash access is too important to be left to innumerable individual commercial decisions which, taken together, represent a significant threat to people and businesses’ ability to withdraw, process and deposit cash.

“The FCA’s consultation rightly recognises this – it’s a good start, but could go further.

“We’re concerned that the FCA’s proposals won’t be enough to pause the trend seen in recent years towards fewer free cashpoints and bank branches.”

Martin added, “Cash is vital as a competitor to other forms of payment, and as a payment option when digital systems go down, or in areas with poor reception. Many vulnerable groups, from elderly people to those fleeing domestic violence, rely on being able to use cash, and it is also a key payment method for many visitors to the UK who are wary of high bank fees when paying by card.

“Now is the time for the FCA to shore up and defend a flexible payments ecosystem which can not only support small businesses and vulnerable communities with cash but can also help to prepare the infrastructure for a diverse range of payment options including a digital currency.

“The proposals should look to the future, too. Banking hubs and other solutions to access to cash may well also be the best opportunities for building digital currency infrastructure in the future.

“As a country, we need a flexible and diverse payments ecosystem that is ready for changing consumer behaviour and needs.

“The FCA should work with the Treasury to safeguard the cash ecosystem, taking a more holistic and comprehensive view of the issue. Now is the time to be ambitious, in order to build the payments infrastructure needed by small businesses and consumers now and into the future.”

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