BRITAIN is continuing to "sleepwalk" into a cash-free society leaving millions disadvantaged because the country lacks new laws to protect consumers, according to new research.

Panel members behind the Access to Cash Review, which published its final first warnings a year ago, are concerned that there is a lack of action in terms of legislation required to protect cash for as long as people need it.

In June, Natalie Ceeney, the ex-financial ombudsman told the Herald that there was a "political hiatus" which meant there was a "deafening silence" in terms of tangible action to prevent people from being left behind.

Now the panel she leads says that in the last 12 months while some progress has been made, "significant issues" within the cash infrastructure remain and there is a continuing failure to bring in laws to protect the public.

In November, the Herald revealed that ministers refused to intervene in the access-to-cash crisis while around 10 free-to-use ATMs were continuing to shut down every week in Scotland in the previous year.

READ MORE: The free cash machine scandal - how ATM loss is affecting your area

Cash machine and bank branch closures have fuelled fears that "cash deserts" are being created, particularly in rural and deprived parts of Scotland.

The Herald: MP Ronnie Cowan

The latest warning comes as SNP's Ronnie Cowan (above), the Inverclyde MP, raised concerns with John Glen, the economic secretary to the Treasury about record numbers of cash machines charging people up to £2 just to get their cash out - particularly in less affluent areas.

An analysis conducted in the area revealed to the Herald shows that over one in three ATMs charge to get cash out. Some 29 out of 81 cash machines tested from Greenock and Port Glasgow to Gourock, Inverkip and Wemyss Bay deducted between 95p and £1.90 from customers to take out cash.

He has told Mr Glen in a letter: "I believe this is a stealth tax which is adversely impacting some of the poorest people in society."

Pointing out that Greenock town centre was judged by the Scottish Index of Multiple Deprivation as the most deprived area of Scotland, he added: "It's evident that my constituency requires support and making them pay to access their money is counterproductive. What is required is financial support for areas such as Inverclyde to help people make ends meet."

He told the Herald: “I am aware of funding which is available for communities to improve access to cash and payment services. I hope to be able to work with local partners to make a submission for funding in-order to improve said access.”

In January, the Herald revealed that one in four of Scotland's cash machines were now charging customers to take their money with the number soaring by 68% in just one year.

READ MORE: Scots pay £10m in a year for the privilege of access to their cash

Part of the problem is that the fees ATM providers receive from banks was cut in July 2018 by network operator LINK, making it less profitable for them to offer the service for free.

According to data from LINK, the UK's largest cash machine network there were 1396 pay-to-use ATMS in Scotland at the end of last year - 565 more than the previous year.

The Herald:

On top of that, the rate of loss of free-to-use cash machines in Scotland rose to 14 every week in the year. That’s up from one in ten in the year to July.

There were 4470 non-charging ATMs at the end of November - with 743 disappearing in a year.

Scotland has already seen over 400 bank branches close since 2015, making it one of the worst affected areas in the UK, and often the cashpoints will also go. Banks who have made the cuts consistently say that it is the result of customers preferring to use online, mobile or telephone banking while usage of branches has fallen.

The Access to Cash Review previously predicted that society would be at the point of being "virtually cashless" by 2035, with fewer than one in 10 transactions being made in cash.

But it said trade association UK Finance now expects the UK to hit this point within the next decade.

Now it says the current legislation is "inadequate" meaning regulators have not legal power to require banks to give their customers appropriate cash access Some of the ‘solutions’ that would help, such as allowing consumers to get cashback more widely without having to make a purchase, cannot be done under current UK law.

READ MORE: More than 40 cash machines shut down every month in Scotland

Panel members also pointed to figures showing that over the past year, 13% of free-to-use UK ATMs have closed, as lower levels of cash use have made them economically unviable. Nearly one in four ATMs in Scotland now charge people to withdraw their cash.

They also said the Post Office's cash access service has come under serious threat.

Various initiatives have been set up by the industry to help maintain people's access to cash, including cashback initiatives at local shops and a "request an ATM" service brought in by LINK.

But the panel said it believes the only way to manage the cash system is for the Government to legislate and give regulators the tools that they need to protect cash access.

Banks should be obliged to provide suitable cash access to their customers, it argued.

The Herald:

Natalie Ceeney, independent chair of the Access to Cash Review said: "The UK is fast becoming a cashless society - without knowing what this really means for consumers or for the UK economy. Many people may want a completely digital future, but we need to make sure that this shift doesn't leave millions behind or put our economy at risk.

"I'm glad that our report of a year ago made the industry and regulators take the issue of cash far more seriously. We welcome the positive initiatives from the banking industry and much needed co-ordination from regulators.

"However, commercial pressures on all businesses mean that we cannot rely on the status quo, and we can see serious strains emerging.

"Regulators currently don't have the tools that they need to ensure that everyone who needs cash can get it. Now is the time for Government to protect cash and allowing us to look ahead to how we can prepare for a digital future which includes everyone."

Jenny Ross, Which? money editor added weight to the call adding: “The cash network has already been dramatically eroded, and unless urgent action is taken in the Budget, it's clear that it will crumble completely.

“Some industry-led initiatives are encouraging, but they cannot stem the tide of bank branch and cash machine closures alone, and without legislation many more communities will be cut off from cash or forced to pay hefty fees to access their own money.

READ MORE: Nationalised Post Bank network proposed to help solve access to cash crisis

“The new chancellor must seize this opportunity and guarantee long-term access to cash in the Budget, while developing a clear strategy to ensure that the transition to digital payments doesn’t leave anyone behind.”

An HM Treasury spokesman said: “Technology has transformed banking for millions of people, but we know that many still rely on cash. That’s why we’ve invested £2 billion to ensure everyday banking services are available at 11,500 Post Office branches across the UK.

“We’re also working closely with industry and regulators to ensure everyone who needs cash can access it.”

The appeal comes as the Access to Cash review fronted an initiative aimed at helping communities free access to cash.

Communities across the country are encouraged to apply to participate in the new Community Access to Cash Pilots, which will help to test solutions to local access to cash needs.

These could include: ensuring that shops give cashback; supporting groups who struggle with digital payments; or helping small businesses accept cash.

It is understood that it is backed by £1m from the financial services industry.

Its launch followed the publication of the 2019 Access to Cash Review, which found 17% of the UK population rely on cash.

Ideas are needed by May 1.


SWEDEN is expected to become the world's first totally cashless society by March, 2023.

The country's central bank Riksbank prompted a parliamentary inquiry last year into the risks posed by a cashless society and the concept of legal tender.

It came after several banks decided to axe cash services, with more and more shops no longer accepting it.
Sweden’s Civil Contingencies Agency had issued guidance to every household, telling residents to stockpile “cash in small denominations” for use in emergencies. These would range from power cuts and disrupted computer networks, through to terrorism and cyber-warfare.

The Herald:

Riksbank is now looking at issuing a central bank digital currency (CBDC), called e-krona so that in "the event of serious shocks to the systems of the banks or card companies", it could be a digital alternative form of payment.

In December, Riksbank partnered with Accenture to trial its digital currency e-krona on mobile phone, card and watch.

An e-krona could potentially give Sweden’s residents access to a digital complement to fiat cash, where the nation’s government would “guarantee the value of the money,” the Riksbank states.

Riksbank says it provides a "state payment alternative that is available to all", a digital complement to cash, where the state would guarantee the value of the money.