(Cash) crisis, what crisis?

As we all know, hard on the heels of the pandemic this summer there was a period of unprecedented high temperatures across the country, which tested the UK’s infrastructure to the limit. UK Finance Cash Services has, over the past few years, ensured that the wholesale cash industry is well prepared for such eventualities by running detailed scenarios to test industry responses to extreme events.

In early March 2020, our members were invited to participate in a test based around the then barely known “coronavirus”. Over the course of a week, a gradually worsening picture was described and responses were subsequently collated. By the end of the exercise members had a good idea of where possible issues could arise. They were able to consider how they could mitigate the effects of a pandemic should one ever occur. Despite some protestations that the scenario went too far, by the end of that month the UK was in lockdown – and everyone knows what happened next. 

Heatwave scenario
In September 2021 a scenario was played out covering a heatwave across the UK. One firm commented that the test had helpfully made them consider risks they had never considered before, but the plot was more akin to a Hollywood movie than to a likely event. However, by the end of July this year almost every part of the scenario had been reported for real, and at least one member had referred to the results of the test for ideas for keeping their operation running despite the heat.

Other tests have included the loss of an alternate payment system and various bad weather events, including the possibility of snow affecting the February launch of the polymer £20 note (although that was actually affected by the pandemic, similar principles came into play).  Every time the industry has stepped up, considered the scenario and shared best practice to ensure that if any of these unlikely events come to pass, it is well prepared to respond.

To date, the wholesale cash supply has not suffered material disruption and the public have always had access to cash as and when they might need it. This is almost certainly due, in part, to the collaborative way in which the industry participates in the scenarios set by UK Finance Cash Services.

Some of our ideas may appear outlandish, but our scenarios have helped the industry visualise potential areas of concern and document ways to address them.  As a result, the general public have never lost confidence in cash and long may it stay that way.

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