Already in sharp decline, Covid, like Don Maclean’s jester has stolen cash’s crown. ATM withdrawals are down 80% in London and though significant, loss of cash is not and must not be allowed to become a terminal inevitability. I was delighted to write on the role of cash in our communities and how we transition together to digital payments in this morning’s Times.
Bank branches are shutting at a rate, five hundred in the past year. Cash points are following fast and the very point of cash is in question. But the essential ‘cash’ point is simply this; cash matters and it matters materially to millions. Take it away, kill it off or let it die and those millions, five million by Financial Conduct Authority estimates, are put in a very difficult place. A place of exclusion, financial and digital, the two all too often walking hideously hand in hand.
So, cash must be supported. Sustainably supported for those individuals, for our High Streets and for our communities. Covid has done so much devastation, but it has taught us much more. Not least what lovely local can look like and financial fluidity is critical if this is to continue and thrive.
To this end, I was delighted that Lord True, for the Government, accepted my amendment to the Financial Services Bill which enables customers to obtain cash without the need for a purchase. This can only assist financial inclusion, our shops, cafes, our local communities and economies. It’s a good step but I know it is just one step. It is essential that the Government build on this through legislating to enable the cash network to be protected as critical national infrastructure. Similarly, it is time for a universal service obligation when it comes to cash provision.
Further, it seems a sensible next step to commission a review into access to digital payments. I put an amendment down to this effect to the aforementioned Financial Services Bill. The future is digital but how we transition together to that future is critical. We do it together, with care, in an inclusive manner or we don’t do anything which can be considered worthwhile. Cash back is an important stepping stone in our transition, until we have true financial and digital inclusion we must also firmly commit to back cash and very likely beyond.
True financial and digital inclusion is multifaceted. An individual may well be confident and capable when it comes to digital but if she or he lives in an area with shaky or no useful connectivity, that financial payment isn’t getting made. Similarly, someone without the digital skills may be given the best banking app out there but that payment isn’t being made.
Multifaceted means cross Government action is required as with, well, pretty much everything. For example, we need to be able to effectively, in real time, link Department for Work and Pensions (DWP) and Her Majesty’s Revenue and Customs (HMRC). We need to have local authority, credit union, fintech start ups, communities and corporates coming together to crack this. We are not short on solutions, we know a deal of what works and we can, at pace, learn a whole lot more. Banks have an essential part to play, as does our Post Office. A brand with over five hundred years of history on our High Streets must be more than post, we desperately need its presence, its future.
Digitally include, financially include and we all benefit. The benefits are not merely economic but social, and psychological. It’s a challenge, a mission for us all. Let’s play our part and transition together, build back better, enabling, empowering, unleashing potential.