While the UK’s rapid shift towards contactless and digital payments continues apace, these moves remain a very real problem and threat to the financial inclusion of a significant number of UK adults, according to the statistics, produced by The Money Charity.
The latest figures released from LINK, the UK’s cash distribution network, show that the number of ‘free-to-use’ cash machines across the UK fell by 6,685 in the year to January 2020, while the number of ATM transactions also fell, by 11.6%. In the same period, the number of ‘pay-to-use’ cash machines increased by 4,187. While these transaction figures do not include those made by customers within their own bank or building society branches, it is likely that these trends will be broadly reflected there.
The primary cause for these falling figures can clearly be identified as the UK shifting its preferred method of payment from cash to digital payments, although other factors, such as the cuts in fees paid to cash machine operators, and ongoing closures of many bank and building society branches, are also in play. The UK has seen a reduction of 22% (2,940) of its total branches since 2012.
However, the increasingly common assertion that “no-one uses cash anymore” can still demonstrably shown to be false, with 2.2 million people saying they only use cash in their daily transactions, according to the 2019 Access to Cash Review. The FCA also state that there are 1.3 million people who do not have any form of bank account, with the highest ‘unbanked’ rate being seen in London, with 4% of the population. When adding in the 7.4 million basic bank accounts (BBAs) which HM Treasury say are currently in use, a much more complex picture of the UK’s approach to managing its money emerges.
Paul Frost, Interim Chief Executive of The Money Charity said “Even as it opens newer, sharper, more intuitive and even exciting ways to manage our money well and increase our financial wellbeing, the technology advances of our onrushing digital world can often feel relentless and all-consuming. It is essential then that as things progress and evolve, we are diligent and aware enough to not leave behind and exclude large portions of society.”
“At The Money Charity, along with others such as Which? and the Access to Cash Review, we are calling on the government to quickly come up with a plan to maintain cash access right across the UK, particularly for the vulnerable and those most dependent upon the cash network. This is an urgent necessity to keep growing the UK’s financial inclusivity, as well as a vital safeguard for us all on the occasions when digital systems fail, which remains a common current issue.”