The UK’s Financial Conduct Authority (FCA) has confirmed that it will protect consumers’ and small businesses’ physical access to cash services—such as ATMs and bank branches—under new rules.

The announcement comes amid the ongoing trend of banks closing their brick-and-mortar high street branches, and the compounding increase in digital payments and banking.

For instance, in Scotland alone, 60% of bank branches have shuttered over the last nine years, according to consumer choice and market research organisation, Which?.

From the 18 September, however, banks and building societies will need to:

• assess cash access and understand if additional services are needed, when changes are being made to local services;
• respond to local residents, community organisations and representative groups, who will be able to request an assessment of whether there are gaps in local cash access;
• deliver reasonable additional cash services, where significant gaps are found, and;
• keep facilities, including bank branches and ATMs, open until any additional cash services identified are available.

The FCA’s powers won’t be able to prevent the closure of bank branches outright — though it will have an impact where branch closures leave significant gaps in local cash access.

Speaking on it, Sheldon Mills, executive director of consumers and competition at the FCA, said: “Three million people continue to rely on cash, even as digital payments become more popular. And many small businesses still need somewhere to safely deposit their takings each day.

“That’s why we’ve acted quickly in response to new powers given to us by Parliament to ensure reasonable access to cash withdrawal and deposits is maintained.”

Current and future gaps in cash access can be filled with a range of measures, including banking hubs, ATMs (including deposit ATMs), and Post Office facilities.

Recommended reading

• Lloyds Banking Groups Set to Close 60 More Branches
• TSB to Close 36 Bank Branches, Cut 250 Jobs
• What can be Done About Scotland’s Disappearing Bank Branches?

According to FCA research on who relies on cash the most, being in a low-income household (less than £15,000 a year) and having low digital capability or access has the strongest association with reliance on cash.