Britain is not yet ready to go cashless. That’s the conclusion of the Access to Cash Review, which has published its final report.
The report confirms that cash is in decline but predicts it will still be around in 15 years.
It also found that merchants and retailers refusing cash was more likely to drive the demise of notes and coins than issues around cash access, although declining numbers of ATMs and access problems were still areas for concern.
The report noted the number of businesses which operated on a cashless basis was still small but that this could change in the future due to cash handling costs. To ensure cash remains widely accepted, the report said action to help retailers keep these costs down was required.
With ATM usage falling at a rate of 6%, it also recommended the setting up of a body by banks and regulators to ensure people have guaranteed access to cash, and that no shift should be made away from free-to-use (FTU) ATMs being the norm. The report highlighted the danger of cash deserts appearing in rural and remote areas where commercial operators close economically unviable FTU ATMs that do not see much use.
Other findings included:
- Over eight million people in the UK (17% of the population) would struggle to cope in a cashless society and that poverty is the biggest indicator of cash dependency not age.
- There is a risk that digital payments innovation could continue to focus on the 80% who are mainstream adopters, not the 20% with more challenging needs. Action is needed to address this.
- There are benefits from the reduction in cash in terms of lower crime and higher tax revenues but those who operate in cash must not be demonised.
- No country in the world has gone cashless. In fact Sweden has started to slow down this transition, as people are getting left behind.
The SGF is currently examining ATM provision and the associated impact on retailers and customers. It seeks a roundtable meeting with the Payment Systems Regulator and the CMA to discuss the matter.