Half million Scots ‘cut off from cash’ as banks shut

HALF a million Scots could struggle to access cash because of bank closures, a Westminster committee has warned.

With 53 per cent of Scotland’s bank branches shutting since 2015, there are fears some groups, particularly the elderly, are being cut off from their own money.

A report by the Scottish affairs committee says the impact of the trend in Scotland is more severe than in other parts of the country as there have been more bank closures here than elsewhere. It has prompted calls for more action to support vulnerable groups.

The committee’s report, released today, says around 500,000 people are reliant on cash and could be ‘left behind’ amid the move to a cashless spending, which has been accelerated by the use of contactless payment during the pandemic.

The report says: ‘Whilst innovation in the financial sector should be welcomed, there are significant concerns about the ability of vulnerable groups and those living in isolated or rural locations to continue to access cash if branch closures and changes to the ATM network continue on the same trajectory.

‘There is also a concern that the transition to digital will overlook those who prefer to use cash, for example for budgeting reasons, and those who prefer to bank in branch rather than online.’

Committee convener Pete Wishart said: ‘While the move to digital banking and payments has offered a method to do transactions many of us enjoy, we cannot forget the 500,000 people in Scotland who rely on cash in their day-to-day lives.

‘With the cost-of-living crisis deepening, many people are using cash for budgeting. But what is deeply worrying is bank branches are closing at a record rate, with very limited research or thought of the possible widespread implications.’

He added: ‘We’re aware of the commercial considerations affecting banks, which has played a role in the recent increase of branch closures.

‘We welcome the effort taken by the banking industry to protect access to cash, although we still feel there is a clear need for legislation.

‘In our report today, we are calling for more research into the implications of a cashless society and more secure and longer-term agreements to ensure the continued access to cash. The Government appears to be in listening mode on this issue, and I look forward to its response in due course.’

The report demands a long-term commitment from banks to mainman

‘Widespread implications’

tain appropriate services for customers via the Post Office network.

Adam Stachura, head of policy at Age Scotland, said: ‘Cash is hugely important to hundreds of thousands of older people in Scotland, but it’s harder to get and harder to use than ever before.

‘We welcome the recommendations from the Scottish Affairs Committee in their important report. The breakneck speed upon which bank branches and free-to-use cash machines have left our high street have made it really tough for those on low incomes in particular to budget, spend and feel in control of their finances.

‘There is no doubt this change has been sped up by the economic effects of Covid-19 but without a proper sense check, those who just can’t function without it are left behind. Our most deprived areas and rural communities bear the biggest brunt.’

He added: ‘An over reliance from banks on a semi-fragile Post Office network is also a big risk, with customers facing the potential of no access at all. Banks can’t just absolve themselves of responsibility and need to invest in a strong cash infrastructure across the whole country.’

A Scottish Government spokessaid it would ‘fully consider the findings of this report, and give consideration to the upcoming Financial Services and Markets Bill to ensure it meets the often unique needs of consumers and communities across Scotland.’