MPs have warned that groups like the elderly and poor could be further disenfranchised by the move to a cashless society if banks are not forced to retain a physical presence.
In a report released today, the Treasury select committee says that despite the rapid move towards contactless, mobile payments and online banking, a lack of government intervention could mean lead to the UK “inadvertently becoming a cashless society”.
The committee notes rural areas have some of the largest populations of elderly and health-impaired individuals, but have been hit by some of the greatest cuts to branches, while access to ATMs continues to be raised as an issue by many elderly groups who require cash to pay for services like carers, cleaners and transport.
Treasury committee chair Nicky Morgan says: “Financial inclusion of vulnerable customers…should be of the utmost priority for financial services providers, the government and financial regulators.
“If the financial services market is unwilling to innovate to halt the closure of bank branches, market intervention by government or the [FCA] may be necessary to force banks to provide a physical network for consumers.”
The committee questions whether making a fiduciary-style duty legally binding for retail financial services companies could be used to address the gap.