Asked by: Jesse Norman (Conservative - Hereford and South Herefordshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps his Department is taking to support residents in Herefordshire in accessing financial services following the recent closures of high street banks.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The decision to close branches is a commercial issue for banks and building societies and the Government does not intervene in these decisions.
Nevertheless, the Government firmly believes that the impact of branch closures should be understood, considered and mitigated where possible so that all customers and businesses continue to have access to banking services.
In September 2020, the Financial Conduct Authority published guidance setting out its expectation of firms when they are deciding to reduce their physical branches or the number of free-to-use ATMs. Firms are expected to carefully consider the impact of a planned closure on their personal and small business customers’ everyday banking and cash access needs and consider possible alternative access arrangements. This will ensure the implementation of closure decisions is undertaken in a way that treats customers fairly. Alternative options for access include the Post Office, which allows 95% of business and 99% of personal banking customers to carry out their everyday banking at 11,500 Post Office branches across the UK.
The Government also remains committed to legislating to protect access to cash and ensuring that the UK's cash infrastructure is sustainable for the long term. On 23 September 2021, the Government closed the Access to Cash Consultation, which included proposals for new laws to make sure people only need to travel a reasonable distance to pay in or take out cash. The Government’s proposals support the continued use of cash in people’s daily lives and help to enable local businesses to continue accepting cash by ensuring they can access deposit facilities. This follows legislative changes to support the widespread offering of cashback without a purchase by shops and other businesses as part of the Financial Services Act 2021.