NAO calls on Treasury to safeguard access to cash
The National Audit Office (NAO) has called on the Treasury to safeguard access to cash after the coronavirus (COVID-19) pandemic accelerated the transition to cashless payments.
The NAO has warned that without co-ordinated effort there is a risk that vulnerable people who rely on cash will be excluded from the economy. A decade ago, cash was used in 60% of transactions, but that number fell to less than 30% by 2019, according to the NAO’s data.
The data suggested that the COVID-19 outbreak may have accelerated this trend further, as market demand for notes and coins declined by 71% between early March and mid-April during the lockdown.
According to the NAO, the decline in the use of cash in transactions is putting pressure on the cash system. Commercial operators who distribute cash rely on high demand to maintain the attractiveness of their business models and cover large fixed costs, such as bank branches and ATMs.
In March 2020, the government announced that it would be bringing forward legislation to protect access to cash and address the sustainability of the cash infrastructure.
However, the NAO said it cannot currently see a clear link between the government’s aim to safeguard the consumer’s ability to use cash, and the responsibilities of the five public bodies in the cash system.
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