(asked on 12th April 2021) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what discussions his Department has had with relevant stakeholders on bringing forward legislative proposals to allow cashback without a purchase.

Answered by
John Glen Portrait
John Glen
Paymaster General and Minister for the Cabinet Office
This question was answered on 20th April 2021

The Government has supported an amendment to the Financial Services Bill that will introduce legislative changes to allow for the widespread offering of cashback without a purchase by shops and other businesses.

The Government’s view is that cashback without a purchase has the potential to be a valuable facility to cash users, and to play an important role in the UK’s cash infrastructure. The recent Call for Evidence on Access to Cash invited views on this issue. It noted that cashback with a purchase was the second most frequently used method for withdrawing cash in the UK behind ATMs in 2019. There were 123 million cashback transactions when using a debit card to make a purchase amounting to a total value of £3.8 billion.

Pre-existing legislation, which derives from the EU’s Second Payment Services Directive, has meant that if a merchant wanted to offer cashback without requiring the customer to make a purchase, that shop, or its agent, would have to be authorised or registered with the Financial Conduct Authority (FCA). This presents a significant burden for many businesses.

This legislative change to enable cashback without a purchase will allow merchants to offer this service without being authorised or registered with the FCA. It is only possible now that the UK has left the EU and is a welcome step towards protecting access to cash for the future.

Treasury Ministers and officials have meetings with a wide variety of organisations in the public and private sectors as part of the process of policy development and delivery.

Details of ministerial and permanent secretary meetings with external organisations on departmental business are published on a quarterly basis and are available at:

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