Banking industry takes further steps to protect access to cash

The Access to Cash Action Group is today announcing two early steps to support customers who depend on cash: the extension of shared Bank Hub pilots, and the rapid rollout of ‘cashback without purchase’ to thousands of smaller shops.

  • Bank Hub pilots in Cambuslang and Rochford to continue until April 2023
  • Cashback without purchase to be available in thousands of shops within months

The group (also known as CAG) was formed earlier this year and is chaired by Natalie Ceeney, author of the Access to Cash Review. With senior representatives from across the banking industry and consumer organisations, CAG is developing a sustainable model for the future to protect access to cash as well as taking immediate action to address people’s needs.

Bank Hub pilots to be extended

Since opening their doors in April, the Bank Hubs have helped over 12,000 customers with access to cash and basic banking needs. The Hubs offer a counter service run by the Post Office, alongside face-to-face access to Community Bankers representing those banks with the most customers in the area.

The Hubs, based in Cambuslang, South Lanarkshire, and Rochford, Essex, had been due to close in October. But the Access to Cash Action Group has decided to extend the Hub pilots until at least April 2023 – giving banks and local communities more time to test new innovations, adapt services to meet people’s needs, and build insight to inform effective solutions for the long term.

‘Cashback without purchase’ to be made available in thousands of shops

Following a successful pilot, LINK and PayPoint will now embark on the rapid rollout of ‘cashback without purchase’ to thousands of smaller shops over the coming months.

During the pilot, customers made thousands of withdrawals and balance enquiries – withdrawing an average of £28 each time. Many withdrawals were for ‘non-round’ amounts that would not be available from an ATM – with one high street banking reporting that half of their customers who used cashback were considered vulnerable.

Legislation passed in April opened the door to thousands of retailers offering cashback to customers without them needing to make a purchase. Under the scheme, customers insert their bank card into an eligible terminal on the counter and can withdraw exactly the amount they need – with the cash provided by the retailer directly from the till. We hope this will be the first of many schemes and operators offering cashback.

Natalie Ceeney CBE, independent Chair of the Access to Cash Action Group: 

We can already see the positive role the Hubs are playing in revitalising these local communities – providing essential banking services for individuals as well as a boost for local businesses. Extending the pilots gives us more opportunity to really understand what works for people, and what role services like these could play in the future. These are early steps, and over the coming months the Group will explore a wide range of options to protect access to cash.

John Glen, Economic Secretary to the Treasury, said:

The Government brought in new laws to make it easier to offer cashback without a purchase earlier this year and it’s great to see the industry taking advantage of these. The next step is to get this innovative new solution rolled out to shops in our local communities to protect access to cash for the millions of people who rely on it.

Nick Read, Chief Executive at the Post Office: 

We are delighted with the success of the Post Office Bank Hubs. In a short space of time local businesses and consumers alike have welcomed the opportunity to do their everyday banking in a secure and bright space, and the banks we have partnered with have been able to serve their customers. We will continue to develop and test new ideas with our bank partners, ensuring that between us we continue to deliver the very best service to the millions of people UK-wide who use cash as a vital part of their everyday lives.

Nick Wiles, CEO of PayPoint: 

PayPoint is delighted to be supporting access to cash through this important new channel and has plans to make cashback without a purchase available through a rapid rollout plan into over 2,000 shops before March next year. PayPoint retailers are located in some of the most disadvantaged communities in the UK where it is even more important that consumers are able to withdraw their cash to the exact penny without paying a fee.

John Howells, CEO of LINK: 

LINK is committed to maintaining free access to cash for as long as it is needed and is delighted that cashback without a purchase will shortly be rolled out in shops across the UK.  While our relationship with cash is changing and many of us are using digital payments more, there are still millions of consumers who depend on cash, so it is vitally important that new ways are found to keep access to cash sustainable for as long as consumers need it.

Vim Maru, Group Director of Retail Banking at Lloyds Banking Group

I am delighted to be part of the Access to Cash Action Group. This is the first of the Group’s announcements and shows the industry’s clear, collective commitment to sustainable access to cash – set out in the May 2021 Cash Pledge. The extension of the Bank Hub pilots and the rollout of ‘cashback without purchase’ are important steps along the way to defining sustainable solutions for the future.

Area of expertise:

Notes to editor

The Access to Cash Action Group is developing industry proposals to protect access to cash in the long term. The Group is chaired by Natalie Ceeney CBE, also Chair of the Community Access to Cash Pilots Board, supported by David Postings, CEO of UK Finance, as Deputy Chair . It includes senior representatives from Barclays Bank UK plc, Coventry Building Society, HSBC UK Bank plc, Lloyds Banking Group, Nationwide Building Society, NatWest Group plc, Santander UK plc, and TSB Bank plc, Age UK, Toynbee Hall and others including the Post Office and LINK. The Group’s work is informed by existing research and ongoing work including the Community Access to Cash Pilots, the 2020 research carried out jointly by the Financial Conduct Authority and the Payments Systems Regulator, and existing industry agreements.

The shared Bank Hubs are being run under the independent Community Access to Cash Pilots, supported by a grant from the major banks.

In November 2020 LINK, the UK’s main ATM cash machine network and PayPoint, the in-store payment services and ATM provider, launched a trial of cashback without purchase in 13 shops across Burslem in Staffordshire (England), Hay-on-Wye in Powys (Wales), Cambuslang in South Lanarkshire (Scotland) and Denny in Falkirk (Scotland).

The services being piloted under the Community Access to Cash scheme complement other industry initiatives to support cash and banking, such as mobile branches and pop-up services. More details are available from individual financial institutions.

The Financial Services Act 2021 removed the need for a business wanting to offer a cashback service without purchase to be authorised or registered by the Financial Conduct Authority. Industry data shows that 2.1 million people mainly use cash for their day-today purchases, with 9.3 billion cash payments made in 2019. In 2019, cashback was the second most commonly used method for withdrawing cash in the UK, behind ATMs. [1]

[1] UK Finance Payments Market 2020, UK Finance, June 2020

Banking industry takes further steps to protect access to cash

17.08.21

Press release