Vulnerable customers could be left without access to physical money
MPs are calling for Chancellor Rishi Sunak to protect the UK cash system from collapse following a steep decline in ATM use during lockdown.
Vulnerable people could be left without access to money unless the government steps in, according to a letter signed by 37 MPs, including former pensions minister Angela Eagle and Lib Dem co-leader Ed Davey.
"Cash is a lifeline for many at the best of times and an important budgeting tool, particularly for the hundreds of thousands of vulnerable people that depend upon it to go about their daily lives," they write.
Use of ATMs in the UK has fallen almost 60% during lockdown compared to one year ago, according to data from cash machine network Link.
Politicians urged the Chancellor to bring forward legislation to protect access to physical money by reviving free-to-use cash machines in local communities.
They also called for Mr Sunak to reverse cuts made to the fee paid by banks to ATM providers each time cash is withdrawn, known as the interchange fee.
“These cuts have saved banks £200m since July 2018 when the first cut took place,” the MPs write.
They highlight that as a result of banks refusing to properly fund the ATM network, customers are losing out as free-to-use cash machines become unviable and operators must start charging.
The MPs write: “This is happening as banks increasingly withdraw their own frontline services and close branches across the UK.”
Why is cash important?
Cash is still used by millions of people across the UK, especially those who are vulnerable or elderly.
An estimated 2.2 million people in the UK rely entirely on cash for their day-to-day transactions, according to research by Access to Cash Review.
It also forecast that the UK could be a cashless society by 2035, however it now expects the nation to hit this point by 2030.
Over the past year alone some 13% of all free to use UK ATMs have closed.
The number of fee-charging ATMs has jumped from 7% to 25%, costing customers £29 million more in fees to withdraw their cash.
Customers and those self-isolating have faced particular difficulty in accessing cash during the coronavirus lockdown as high street bank branches and ATMs closed.