Commons Sense

House of Commons · Westminster Hall

Covid-19: Access to and Acceptance of Cash

03 December 2020 · 5 other contributors · 13,372 words

Opened by Paul Maynard Con Blackpool North and Cleveleys

Responding minister: Jesse Norman

EconomyTaxationTransport

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Paul Maynard raised concerns about covid-19: access to and acceptance of cash in Westminster Hall. A government minister responded.

Key points

  • Paul Maynard is concerned about the decline in cash usage, particularly affecting elderly and vulnerable individuals who struggle with technology.
  • The minister highlighted actions by regulators and industry to support customers reliant on cash during the pandemic, including proactive communications and cash deliveries.
  • Maynard asks the Government to bring forward legislation to protect the cash industry, including a legal right to pay for essential goods and services with cash.

Key requests to Government

Maynard asks for confirmation that regulations will be tabled to extend cashback without purchase pilots to include deposits, ensuring local businesses have more options for handling cash end-of-day. He also seeks the Government's commitment to accelerate the proposal for a public utility model in the distribution of cash infrastructure and urges a national conversation on managing the transition to a near-cashless society. The speaker asks the Government to bring forward legislation promised in March to protect the cash industry, including protections not only for accessing cash but also free cash. She requests a legal right to pay for essential goods and services with cash, and urges for cashback availability from medium and large retailers.

How the debate unfolded

MPs spoke in turn to share their views and ask questions. Here's what each person said.

Opened the debate

Paul Maynard Con Blackpool North and Cleveleys

Paul Maynard is concerned about the rapid decline in cash usage, particularly impacting elderly and vulnerable individuals who struggle with technology. He cites Which? research indicating that two in five people have faced difficulties paying with cash due to lack of alternative payment methods. The trend towards a cashless society has accelerated, with London leading at 75% card usage compared to 50% in the north-west. ATM withdrawals dropped by 20-30% pre-lockdown and further during lockdown, with recovery only partial. The speaker is concerned about the decline in free-to-use cash machines, which has fallen by 46% since 2018 in her constituency. She points out that low-income households are less likely to have access to digital infrastructure and more dependent on cash for budgeting reasons. The pandemic has highlighted accessibility issues for those with health problems or cognitive difficulties who prefer using cash due to its tactile nature and security concerns regarding digital payments.

Other contributors (5)
  • Bridget Phillipson Lab Houghton and Sunderland South

    Phillipson highlighted the decline in cash usage, especially during the pandemic. She cited a Treasury Committee report indicating that around 1 million people lack bank accounts and many communities rely on cash for budgeting or due to limited online access. ATM withdrawals dropped by 60% between March and April 2020 compared to the previous year, but this shift may be long-lasting. Phillipson urged the Government to legislate quickly to protect access to cash, stressing that inaction could exacerbate financial inequality.

  • Jamie Stone Lib Dem Caithness, Sutherland and Easter Ross

    Described the impact of cash machine closures on remote communities like Durness in north-west Scotland, highlighting how local economies rely on these machines during events. Mentioned electricity outages affecting electronic payment methods. Stressed the importance of a single remaining bank branch serving a vast area and advocated for joint banking hubs to address access issues. Noted security risks and difficulties for businesses depositing cash due to remote locations. The MP agrees that the closure of local bank branches and post offices is contributing to the decline of Scottish high streets.

  • Jim Shannon DUP Strangford

    Jim Shannon highlighted the decline in cash usage and acceptance, citing examples of businesses refusing to take cash during the pandemic. He mentioned a case where his parliamentary aide faced issues with contactless payment at Menarys department store. Shannon also discussed the loss of ATMs and bank branches in Strangford, noting the need for reliable card machines and the impact on vulnerable people who rely on cash. Asked whether the Department has had the opportunity to talk to the Association of Convenience Stores about ideas for helping the ATM system.

  • Patricia Gibson SNP North Ayrshire and Arran

    Expressed concern over the rapid decline in cash machine availability, highlighting that 9,500 ATMs have been lost since 2017. Emphasised the importance of access to cash for those who rely on it as a budgeting tool and stressed the need for legislation to protect such access. Asked for an intervention from the Minister.

  • Yvonne Fovargue Lab Wigan

    Ms Fovargue expressed concern about the rapid shift towards a cashless society, noting that while some people prefer digital payments, many others rely on cash due to financial constraints or preference. She highlighted the decline in ATM access and the closure of bank branches, particularly impacting deprived areas where cash usage remains high. She cited statistics showing a 70% drop in cash use in wealthy areas compared to 35% in more deprived ones. Fovargue also pointed out that many people lack bank accounts or credit cards and find budgeting easier with physical currency. Concerns were raised about the closure of post offices, increasing reliance on pay-to-use ATMs, and potential barriers for those who need cash for essential items. Inquired if the purpose of reasonable access to cash is to free cash machines, highlighting it as a key point.

Government Response

Jesse Norman

The minister thanked everyone for their contributions, noting the importance of digital payments but acknowledging that cash remains essential. He highlighted actions taken by regulators and industry to support customers reliant on cash during the pandemic, including proactive communications, cash deliveries, and issuing carer cards. The Joint Authorities Cash Strategy group was mentioned as a key player in ensuring comprehensive oversight of the UK's cash infrastructure. The minister also discussed the call for evidence on access to cash, emphasising that responses would be published and steps set out in due course.

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