Asked by: Lord Bishop of St Albans (Bishops - Bishops)
Question to the HM Treasury:
To ask His Majesty's Government what steps they are taking to protect the use of cash in the purchasing of everyday goods and services.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
In recognition that cash continues to be used by millions of people across the UK, including those in vulnerable circumstances, the government legislated through the Financial Services and Markets Act 2023 to establish a new legislative framework to protect access to cash. This establishes the Financial Conduct Authority (FCA) as the lead regulator for access to cash and provides it with responsibility and powers to seek to ensure reasonable provision of cash withdrawal and deposit facilities.
Following this legislation, the government published a Cash Access Policy Statement. This set out that the vast majority of people should be no further than 1 mile from access to cash deposit and withdrawal services in predominately urban areas, and no further than 3 miles in predominately rural areas. The FCA is required to have regard to this statement when exercising its access to cash powers.
The government believes it should remain the choice of individual businesses as to whether to accept or decline any form of payment, including cash or card, based on their consideration of factors such as customer preference and cost. However, the government considers that its legislation will indirectly support cash acceptance in the wider economy, enabling businesses to continue accepting cash by ensuring they have reasonable access to deposit facilities.
Asked by: Matt Hancock (Conservative - West Suffolk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many businesses the Financial Conduct Authority regulated (a) as of 20 May 2024 and (b) in 2016.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The Financial Services and Markets Act 2000 establishes the framework for financial services regulation. It provides for the Treasury and Parliament, through legislation, to determine which activities, products and markets are regulated and fall within the remit of the Financial Conduct Authority (FCA). The FCA is responsible for regulating and supervising the financial services industry, including authorising businesses.
The question of how many businesses the FCA regulated is a matter for the FCA, which is operationally independent from Government. The FCA will respond to the Honourable Member by letter on this matter, and a copy of the letter will be placed in the Library of the House of Commons.
Asked by: Gen Kitchen (Labour - Wellingborough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the potential impact of bank closures on access to (a) cash and (b) in-person services in Wellingborough constituency.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
Decisions to open or close a branch are commercial and the Government does not make assessments of these closure decisions. Nonetheless, it is imperative that banks and building societies recognise the needs of all their customers, including those who need to use cash or in-person services. The Government is monitoring the wider situation closely.
The Government legislated through the Financial Services and Markets Act 2023 to introduce a new legislative framework to protect access to cash. The Financial Conduct Authority (FCA) must seek to ensure that there is reasonable provision of free withdrawal and deposit facilities in relation to personal current accounts. Upon the closure of a core cash service such as a bank branch, LINK assesses the community’s access to cash needs. If additional cash services are needed, industry will provide a shared solution such as a Banking Hub.
Guidance from the FCA sets out its expectation of firms when they are deciding to reduce their physical branches or the number of free-to-use ATMs. The FCA’s guidance is clear that firms are expected to carefully consider the impact of planned branch closures on their customers’ everyday banking and cash access needs, and put in place alternatives, where this is reasonable. Alternative options to access everyday banking services can be via telephone banking, through digital means such as mobile or online banking and via the Post Office or Banking Hubs.
UK Finance have recently confirmed 225 Banking Hubs will be announced by the end of 2024, up from the 130 locations currently confirmed. Furthermore, following my recent discussions with the UK high street banks, participating firms have also committed to improving Hubs by standardising the services available between firms, ensuring that customers will not require their own digital device to bank, trialling a ‘customer liaison service’ and trialling Saturday openings.
Asked by: Gen Kitchen (Labour - Wellingborough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an estimate of the number of bank branches that have closed in (a) Wellingborough constituency and (b) Northamptonshire in each year since 2010.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
Decisions to open or close a branch are commercial and the Government does not make assessments of these closure decisions. Nonetheless, it is imperative that banks and building societies recognise the needs of all their customers, including those who need to use cash or in-person services. The Government is monitoring the wider situation closely.
The Government legislated through the Financial Services and Markets Act 2023 to introduce a new legislative framework to protect access to cash. The Financial Conduct Authority (FCA) must seek to ensure that there is reasonable provision of free withdrawal and deposit facilities in relation to personal current accounts. Upon the closure of a core cash service such as a bank branch, LINK assesses the community’s access to cash needs. If additional cash services are needed, industry will provide a shared solution such as a Banking Hub.
Guidance from the FCA sets out its expectation of firms when they are deciding to reduce their physical branches or the number of free-to-use ATMs. The FCA’s guidance is clear that firms are expected to carefully consider the impact of planned branch closures on their customers’ everyday banking and cash access needs, and put in place alternatives, where this is reasonable. Alternative options to access everyday banking services can be via telephone banking, through digital means such as mobile or online banking and via the Post Office or Banking Hubs.
UK Finance have recently confirmed 225 Banking Hubs will be announced by the end of 2024, up from the 130 locations currently confirmed. Furthermore, following my recent discussions with the UK high street banks, participating firms have also committed to improving Hubs by standardising the services available between firms, ensuring that customers will not require their own digital device to bank, trialling a ‘customer liaison service’ and trialling Saturday openings.
Asked by: Andrew Rosindell (Conservative - Romford)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will take steps to provide incentives to high street (a) banks and (b) building societies to provide bank hub services.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
Banking Hubs are a voluntary initiative provided by the financial services sector. Upon the closure of a core cash access service, such as a bank branch, or a direct request from a community, LINK assesses the community’s access to cash needs. If additional cash services are needed, industry will provide a shared solution such as a Banking Hub. Hubs offer basic counter services provided by Post Office staff, allowing people and businesses to withdraw and deposit cash, deposit cheques, pay bills and make balance enquiries. They also contain dedicated rooms where customers can see community bankers from their own bank.
UK Finance have recently confirmed 225 Banking Hubs will be announced by the end of 2024, up from the 130 locations currently confirmed. Furthermore, following the Government’s recent discussions with the UK high street banks, participating firms have also committed to improving Hubs by standardising the services available between firms, ensuring that customers will not require their own digital device to bank, trialling a ‘customer liaison service’ and trialling Saturday openings.
The Government legislated as part of the Financial Services and Markets Act 2023 to establish the FCA as the lead regulator for access to cash, giving it responsibility to seek to ensure reasonable provision of cash withdrawal and deposit facilities. The FCA recently held a consultation on its proposed regulatory regime for access to cash, following the Government’s legislation: FCA consultation on access to cash. These proposals build on and strengthen the arrangement that has been established by the financial services sector by placing it on a regulatory footing. The FCA expects to publish its final rules by the end of the third quarter of this year.
Asked by: Gen Kitchen (Labour - Wellingborough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will take steps to help ensure free access to cash (a) withdrawal and (b) deposit facilities in Wellingborough constituency.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
In recognition that cash continues to be used by millions of people across the UK, including those in vulnerable circumstances, the government legislated through the Financial Services and Markets Act 2023 to establish a new legislative framework to protect access to cash. This establishes the Financial Conduct Authority (FCA) as the lead regulator for access to cash and provides it with responsibility and powers to seek to ensure reasonable provision of cash withdrawal and deposit facilities. As part of this responsibility, the FCA must also seek to ensure that there is reasonable provision of free withdrawal and deposit facilities in relation to personal current accounts.
Following this legislation, the government published a Cash Access Policy Statement. This set out that the vast majority of people should be no further than 1 mile from access to cash deposit and withdrawal services in predominately urban areas, and no further than 3 miles in predominately rural areas. The FCA is required to have regard to this statement when exercising its access to cash powers.
The FCA recently held a consultation on its proposed regulatory approach: FCA Access to Cash Consultation. The FCA is currently considering feedback and expects to publish its final rules in the third quarter of this year.
Asked by: John Hayes (Conservative - South Holland and The Deepings)
Question to the Department for Business and Trade:
To ask the Secretary of State for Business and Trade, how much the Competition and Markets Authority has spent on external consultancies in each of the last five years.
Answered by Kevin Hollinrake - Minister of State (Department for Business and Trade)
For each of the last five audited financial years, the Competition and Markets Authority has spent the following amount on external consultancies.
Year Amount
2018/19 £239,900.46
2019/20 £541,058.36
2020/21 £585,389.23
2021/22 £733,361.96
2022/23 £786,795.35
Figures for 2023/24 have not been finalised and will be published in the CMA annual report in July 2024 once audited.
Asked by: Tanmanjeet Singh Dhesi (Labour - Slough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps he plans to take to support small businesses with cash banking, in the context of closures of physical banks.
Answered by Nigel Huddleston - Financial Secretary (HM Treasury)
In recognition that cash continues to be used by millions of people across the UK, including those in vulnerable circumstances, the government legislated through the Financial Services and Markets Act 2023 to establish a new legislative framework to protect access to cash. This establishes the Financial Conduct Authority (FCA) as the lead regulator for access to cash and provides it with responsibility and powers to seek to ensure reasonable provision of cash withdrawal and deposit facilities.
Following this legislation, the government published a Cash Access Policy Statement. This set out that the vast majority of people should be no further than 1 mile from access to cash deposit and withdrawal services in predominately urban areas, and no further than 3 miles in predominately rural areas. The FCA is required to have regard to this statement when exercising its access to cash powers.
The government considers that this legislation will support businesses to continue accepting cash by ensuring they have reasonable access to deposit facilities.
The FCA recently held a consultation on its proposed regulatory approach: FCA Access to Cash Consultation. The FCA is currently considering feedback and expects to publish its final rules in the third quarter of this year.
Asked by: Tanmanjeet Singh Dhesi (Labour - Slough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he plans to take legislative steps to help ensure public access to cash.
Answered by Nigel Huddleston - Financial Secretary (HM Treasury)
In recognition that cash continues to be used by millions of people across the UK, including those in vulnerable circumstances, the government legislated through the Financial Services and Markets Act 2023 to establish a new legislative framework to protect access to cash. This establishes the Financial Conduct Authority (FCA) as the lead regulator for access to cash and provides it with responsibility and powers to seek to ensure reasonable provision of cash withdrawal and deposit facilities.
Following this legislation, the government published a Cash Access Policy Statement. This set out that the vast majority of people should be no further than 1 mile from access to cash deposit and withdrawal services in predominately urban areas, and no further than 3 miles in predominately rural areas. The FCA is required to have regard to this statement when exercising its access to cash powers.
The government considers that this legislation will support businesses to continue accepting cash by ensuring they have reasonable access to deposit facilities.
The FCA recently held a consultation on its proposed regulatory approach: FCA Access to Cash Consultation. The FCA is currently considering feedback and expects to publish its final rules in the third quarter of this year.
Asked by: Tanmanjeet Singh Dhesi (Labour - Slough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he plans to bring forward legislative proposals to reinforce the status of cash as legal tender.
Answered by Nigel Huddleston - Financial Secretary (HM Treasury)
The forms of payment that are accepted should remain the choice of individual businesses , based on their consideration of factors such as customer preference and cost.
Nevertheless, the Government recognises that cash continues to be used by millions of people across the UK. The Financial Services and Markets Act 2023 established a new legislative framework to protect access to cash for consumers and businesses.