A devastating “cash famine” is coming unless urgent action is taken over bank closures, experts have warned. Shocking figures show one in five cash machines were taken out of service in the past five years while the number of bank branches has dropped by 40 per cent in a decade. Ministers were warned it is time for radical plans to protect access to cash before it is too late.
One potential solution is banking hubs, which allow customers from different banks to deposit and withdraw money over the counter.
At least 1,000 hubs must be opened to stop communities from facing a cash crisis, it was said.
As it stands, just four sites are currently up and running.
Christopher Brooks, head of policy at Age UK, said: “The banks have been cutting branches at an alarming rate and that continues to happen. So it’s really important that an alternative is put in place.
“We’re very supportive of the banking hubs which are really good and are able to provide the majority of services that a bank branch can.
“It seems at the moment that all the banks are fully committed to providing these hubs.
“There are only four at the moment but more are coming.
“If they were rolled out across the country, so everywhere that needed a hub had one, there would be hundreds and hundreds, if not 1,000-plus hubs.
“The biggest threat, I think, is the bank’s commitment waning. So hopefully they will remain engaged and remain committed to providing physical services.”
Mr Brooks said a “sizeable” number of people still rely on cash and pointed out that bank closures also hit local businesses.
He added: “The hubs can deliver all of these kinds of services and they can come close to replicating the bank branches.
“So I think that they probably are the future. The drawback so far is the pace of the rollout.”
Banks say that Britons’ increased use of online services is behind branch closures.
But the Daily Express’s Save Our High Street Banks crusade calls on firms to offer a choice.
Dennis Reed, director of the Silver Voices over-60s campaign group, said: “We get regular reports from our members that they are finding it difficult to access cash. It is another isolating factor for older people.
“Many rely on cash to do their shopping, pay window cleaners and other people, and they cannot get access to it unless they have a car, which many don’t. It is of great concern.
“I think hubs are a good idea where there is no alternative. The Government has a role here as well to knock the heads of the banks together.
“A cash famine is on the horizon for many communities unless urgent action is taken.”
Lord Foulkes, co-chairman of the All-Party Parliamentary Group for Older People, said: “The banks are sacrificing the needs of older people in their quest for increased profits.
“Older people are one of the groups that prefer using cash. The disappearance of ATMs on top of the closure of branches is causing them great distress and difficulties.
“The Government and the regulator should step in urgently to protect their interests.”
Shadow Levelling Up and Communities Secretary Lisa Nandy said: “Over the last decade, institutions that we rely on – from bank branches and post offices to shops and cash machines – have disappeared.
“Access to cash remains essential for many people but, like so many things, it has been the victim of a Tory Government that has written off large parts of our country and hollowed out vital local services.”
House of Commons library research shows that between July 2018 and September 2022 the number of cashpoints in the UK fell by 14,665 – some 22 per cent.
The number of free-to-use cash machines fell in 2018 for the first time in 20 years and has fallen each year since. There was also a 40 per cent drop in the number of bank and building society branches in the past 10 years, from 13,345 in 2012 to just 8,060 in 2022.
A Government spokesman said: “Cash continues to be used by millions across the UK.
“Our Financial Services Bill will give regulators the power to set standards that guarantee people will have reasonable access to their hard-earned cash.
“Regenerating high streets is essential to our commitment to level up the country. That’s why we are investing billions in projects that will renew and reshape town centres and high streets in a way that drives growth and improves the lives of local people.”
