Ensuring free access to cash across the UK as new FCA rules come into force

A new regulatory regime to support access to cash comes into effect on 18 September 2024, as the Financial Conduct Authority (FCA) implements measures to ensure the "reasonable provision of cash deposit and withdrawal services" for individuals and businesses across the UK. These rules require certain banks and building societies (designated by HM Treasury) to assess and address any gaps that hinder cash access, safeguarding the needs of millions who rely on cash as a vital part of their daily lives.

LINK, the UK's leading ATM network, has been designated by HM Treasury as an official "operator of cash access coordination arrangements" under the new regulatory framework. For nearly a decade, RPC, an international law firm, has advised LINK, including in its efforts to safeguard the nation's access to cash.

Under the new regulatory regime, the LINK responsibilities as an "operator of cash access coordination arrangements" will include independently assessing the impact of changes to cash access services across UK communities. Using agreed process, LINK will make recommendations for additional services, such as shared banking hubs, deposit services, and ATMs, where necessary. These responsibilities build on LINK’s existing voluntary arrangements to assist participating banks and building societies in safeguarding access to cash in communities.

Charles Buckworth, Partner at RPC, has been instrumental in advising LINK on legal matters related to the LINK Scheme and maintaining a robust cash access network. Commenting on the new FCA regulatory regime, Charles said: "The rapid pace of regulatory change across financial services continues and as the FCA rolls out these new regulations, legal expertise in navigating regulatory change in a complex ecosystem is increasingly critical. The UK has seen a rapid shift towards digital payments, accelerated by innovations in technology and changes in consumer behaviour. However, for many, particularly vulnerable consumers and small businesses, access to cash remains essential. The new FCA rules reflect the need to balance the convenience of digital payments with the continued availability of cash, especially in areas where digital inclusion remains a challenge."

Key points¹

1. If a significant gap in cash access is identified, designated banks and building societies must promptly provide additional cash access solutions. This may involve setting up banking hubs, partnering with the Post Office, or offering alternative cash access points.
   
   
2. It's crucial for designated banks and building societies to communicate clearly with consumers and businesses about any changes to cash access services. They should be informed about where and how they can access cash, how to request additional services, and the process for reviewing assessment outcomes.
   
   
3. Designated banks and building societies should ensure reasonable access to coins and notes for consumers and businesses. This is essential for those who need to handle non-rounded amounts in cash transactions.
   
   
4. Continuous monitoring of cash access coverage is necessary to ensure compliance with the policy. Regular reporting to the FCA and other relevant bodies will help maintain transparency and accountability, ensuring that the needs of all communities are met.

John Howells, CEO of LINK, emphasises the importance of keeping people at the centre of these changes: “Although the UK is on the path to becoming a low-cash country, our priority must be ensuring that everyone, especially those who rely on cash, can continue to access it easily. The new regulatory regime will help ensure that no one is left behind."