Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether he has made an assessment of the potential merits of introducing a minimum level of access to essential in-person banking services.

The way consumers and businesses interact with their banking and make payments continues to develop at pace, bringing significant benefits to those who choose to opt for the convenience, security, and speed of digital services.

In recognition that cash continues to be used by millions of people across the UK, the government is currently taking legislation through Parliament as part of the Financial Services and Markets Bill to protect access to cash. The Bill will establish the Financial Conduct Authority (FCA) as the lead regulator for access to cash and provide it with appropriate powers to seek to ensure reasonable provision of withdrawal and deposit facilities. These powers will allow the FCA to have regard to factors it considers appropriate, which could include cost for users.

Regarding in-person banking services, the government believes that everyone, wherever they live, should have appropriate access to banking services. However, decisions on opening and closing branches, and the provision of in-person services, are a commercial issue for banks and building societies.

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 guidance has recently been strengthened and clearly expects firms to put in place alternatives, where this is reasonable, to ensure customer needs are met. Where firms fall short of expectations, the FCA may ask for closures to be paused or other options to be put in place.

Alternative options to access cash and in-person banking services can be via the Post Office and other industry initiatives including cash pods, mobile banking vans and shared banking hubs. The Post Office Banking Framework allows 99% of personal banking and 95% of business customers to deposit cheques, check their balance and withdraw and deposit cash at 11,500 Post Office branches across the UK. Meanwhile, industry has committed to shared banking hubs in over 40 locations across the UK to date.