Cashpoint system on brink of collapse

Communities left behind as free-to-use cashpoints and bank branches close

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The UK’s free-to-use cashpoint system is collapsing amid continuing bank branch closures, leaving many underserved communities, vulnerable people and small businesses behind.



New research from consumer magazine Which? found that roughly 9,500 free-to-use cash machines have disappeared in the last two years alone, accounting for nearly 1 in 5 of all cash points. At the same time 1,200 bank branches have shut their doors.



Despite the emergence of digital banking, there is still a huge demand for cash, with Which? having collected 3,153 cash machine requests from the public, many of whom live in towns or villages without a single free cash point.



Which? passed on these requests to Link, the largest network of cash machines in the UK, but Link has said that it only has funding for 100 new machines and desperately needs government intervention to save the UK’s cash infrastructure.



As with bank branch closures, the disappearance of free cash machines has hit poorer and more rural areas hardest.



The latest Which? research has found that, for example, Ward End in Birmingham has lost nearly all its free cash machines in the last two years, going from 11 in 2018 to only one now. Meanwhile, East Ham North in London now has only two free cash machines, down from eight two years ago.



Several towns with populations of more than 5,000, including Royston Heath in North Hertfordshire, East Malling in Kent and Essington in Staffordshire South have not a single free-to-use cash point.



Which? investigated the impact of lack of access to free cash machines in the village of Harlech in Wales, where many of its businesses such as takeaways and guest houses are cash-only. Because Internet connectivity in the rural town is very poor, card transactions are often problematic. Residents tell of having spend an entire morning having to travel further afield to the nearest bank branch. Shop owners explained how customers, frustrated by lack of cash access in the town, will often take their business elsewhere.



Another resident explained how lack of access to free cash points impacts the most vulnerable.



“One thing you can’t pay for by card is if you have to pre-pay for electricity. A surprising number of people do,” she said. “So immediately, if you want to put £10 of electricity in and you’re on a limited budget, £1.75 of your £10 is going on getting your £10. It feels to me all the time as if the bank has made savings coming out of communities with the fewest choices and the least opportunities for sustainable or well-paid employment.”



Branch closures

Unite has long campaigned against the closure of bank branches that are fuelling the destruction of the cash economy.



Banks have justified closing branches by noting that the Post Office offers a viable banking alternative but Unite has highlighted that the Post Office network simply does not have the capacity and only offers limited banking facilities. What’ s more, Post Offices too are increasingly closing — indeed in Harlech, the only other free cash withdrawal option in town, the Post Office, closed recently.



Unite’s reps and members working in bank branches are on the front lines of branch closures and have witnessed the impact they’ve had.



‘Whilst handing a branch closure it was a great shame to see so many elderly people struggling with daily banking needs,” one bank worker said. “I had customers panicking thinking they were going to lose their money.”



Another branch worker highlighted how they were asked by management to contact vulnerable customers before a branch closure.



“I had an extensive list of over 250 customers at this particular branch. I got complaints and a lot of grief from customers unhappy about the closure. I did the best I could and helped customers but they were not happy.”


Job losses

Bank branch and cash point closures are also occurring in tandem with significant job losses in bank branches, meted out by a banking sector abandoning its responsibility to communities and customers.



On Wednesday (February 26), Lloyds Banking Group (LBG) announced it will slash 780 full-time staff across its bank branch network between June and October this year.



Unite LBG committee chair Scott Doyle said the job cuts were “yet more evidence of the bank’s profits over people culture”.



“Unite accepts that banking models constantly change and update but this doesn’t need to equate to walking away from community banking and the public who have been loyal to the bank,” he added.



Unite national officer Dominic Hook agreed and called for action from both the government and the banking sector.



“The government needs to recognise that the banking sector has social responsibilities and is a vital public service,” he said. “Bank branch and ATM closure decisions must be influenced by the needs of the local communities and businesses impacted.


“Public impact assessments are vital ahead of closure plans are made,” he added. “The need for meaningful consultation with the local community is evident. It is time for the banking industry to stop abandoning the local communities which bring the sector its vast profits. None of the new technologies replace the experience and skill of bank branch staff. No app or website can provide some of the most vulnerable and socially excluded in our society with the face to face financial assistance they need.”



Find out more about what Unite is doing to stop branch and cash machine closures, and how you can campaign against them with the union’s toolkit here.

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