New Powers Granted to UK Financial Conduct Authority to Enforce Cash Provision by Banks
The UK’s Financial Conduct Authority (FCA) has been given new powers to enforce the provision of cash by banks. Under the new legislation, the Financial Services and Markets Act 2023, the FCA will be able to fine banks and building societies that fail to comply with the minimum expectations for cash users.
While digital payments have become increasingly popular, cash still plays an important role in society. Economic Secretary to the Treasury, Andrew Griffith, stated that the government is committed to protecting access to cash, ensuring fee-free withdrawals and the availability of cash facilities within a reasonable distance.
In recent years, the UK has seen a decline in the use of coins and notes, with online payments rising from 45% to 85% in the past decade. However, concerns have been raised regarding access to cash, especially for marginalized groups and those in rural areas.
As part of the new consumer protections, the majority of people and businesses will have access to cash machines within a three-mile radius. This will alleviate the inconvenience of traveling long distances to withdraw or deposit cash, particularly for those in rural areas, the elderly, and individuals with disabilities.
The new legislation also mandates that any services withdrawn must be replaced before a closure takes place.