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Elderly will be excluded from a cashless society, says Age UK

One in five elderly people rely on cash and cutting them off from it ignores the needs of millions of citizens, according to an Age UK report. 

The charity is calling on the Government to oblige banks to guarantee access to cash for everyone, and on shops and service providers to accept payments in a way that meets customers’ needs.

Use of physical money is declining, but the Treasury promised new laws to protect access to cash during the spring 2020 Budget, and has moved to ensure people can get cashback in shops without having to buy anything from 29 June.

Money matters: Around 2.4 million people aged 65 and over rely on cash to a great extent in their day-to-day life, according to data from the City regulator

But Age UK is calling for a ‘universal service obligation’ on banks, to put access to the cash system on the same footing as water, electricity, post and broadband services which already have USOs.

‘Being cut off from cash and banking services is tantamount to being excluded from society,’ says the charity.

And it adds: ‘It’s no use having cash if you’re unable to spend it, so it’s important that all shops and service providers continue to take payments in a way that meets their customers’ needs – which in most cases will mean continuing to accept cash.’

Consumer group Which? has also urged the government to move swiftly with legislative proposals to protect access to cash, saying: ‘People cannot be left in a position where they are unable to purchase essential products and services because they cannot access or pay with cash.’

It has signed up thousands of supermarkets and other shops around the country to a pledge to continue to accept cash.

But it adds: ‘Legislation to protect cash must give the Financial Conduct Authority powers to monitor cash acceptance to establish if further action might be needed.’

Let us pay with cash! 

One in five shoppers say they have been barred from using real money since lockdown, according to a survey published by our sister publication Money Mail last week.

It called on shops and businesses to start accepting cash again. Read its full report here. 

A Treasury spokesperson said: ‘We know cash is vital for millions of people – that’s why we are taking action to ensure people across the UK can continue to access it. 

‘We’ve already legislated to make it easier for businesses of all sizes to offer cashback without a purchase, and in May we outlined the next stage in delivering on our pledge of legislation to protect access to cash for those who need it.’

A consultation is due this summer on proposals for further legislation, but the Treasury believes any changes must be carefully designed to cover current and future needs.  

Age UK has just released a new report called ‘Short-changed: How the decline of cash is affecting older people’. The charity makes the following points.

– Around one in five or 2.4 million people aged 65 and over rely on cash to a great extent in their day-to-day life, according to the Financial Lives 2020 Survey by the Financial Conduct Authority.

‘They used it for almost all their payments, so retaining access is clearly fundamental to their daily lives,’ says Age UK.

– A more recent survey from January 2021 found more than half of over-65s, or nearly 6.3million people, had used cash within the past week, despite the UK being in a national lockdown and many older people shielding at home.

Nearly three-quarters of over-65s, around 8.8 million people, had used cash at some point in the past month. Two-thirds of under-65s, or around 25 million adults, had also done so within that time.

– National lockdowns severely restricted opportunities to spend cash, and millions of older people were asked to shield at home, 

‘At this time, many older and disabled people were forced to rely on family, neighbours, and volunteers to get shopping and pay bills on their behalf, with cash often the preferred payment or repayment method,’ says the charity.

– More generally, cash helps people on a low-income budget more effectively, pay back a carer or friend who shops for them, and offers an essential back-up for those not online or living in an area with poor connectivity, it says.

‘Many people with health conditions, disabilities and dexterity issues find paying in cash much easier than with a bank card or a phone – it’s not easy for someone with sight loss to use a card reader, or someone with bad arthritis in their hands to hit the right buttons on a smart phone.’

– An Age UK survey of its Your Voice panel, a self-selected group of hundreds of people aged over 50, but which is weighted towards over-75s, found one in six had difficulty using cash during the pandemic.

A quarter had been refused when they or someone on their behalf had tried to pay with cash, found Age UK.


Should ‘no cash’ rules by shops and businesses be banned?

‘Declining use and provision of cash consequently mean that more and more businesses and other service providers are refusing to accept it – a vicious circle,’ it says.

– Figures from cash machine network LINK show that £81billion was taken out from ATMs last year, equivalent to every adult in the UK withdrawing more than £1,500 each.

‘Even amid national lockdowns, with older people shielding, fewer ATMs available and bank branches shut, it is obvious that millions still needed cash for their essential spending,’ says Age UK.

– The decline in high street banks and cash machines before the pandemic made access to cash problematic, and this has worsened according to the charity.

‘Alongside the plummeting number of ATMs, banks are deserting many communities, with thousands of branches shut, reducing their hours, or scheduled to close.

‘Contrary to popular belief, it is not only rural areas suffering from declining cash access. In fact, recent research by the FCA shows that areas classified as ‘multicultural metropolitans’ witnessed the biggest decrease in free-to-use ATMs between March 2018 and 2020.’

– Half of over-65s do not use or have not recently used internet banking, compared to 10 per cent of 25-34-year-olds, according to Office for National Statistics data.

Age UK says its own research has shown little evidence that significant numbers of people who don’t use internet banking were prompted to do so during the first few months of the pandemic.

‘The vast majority of older people are perfectly capable of managing their money themselves, but the rapid move to online banking and digital payments has left many struggling because of the technology.’

‘All these little things become huge problems’ 

 Eileen, 72, explains how lack of access to cash has affected her life during the pandemic.

People were lovely and would do some shopping for us, but I didn’t always have money in the house to pay them, and I couldn’t access money.

Finding loose change for somebody who went and got the paper for me; that’s 70 pence, but then you realise you’ve only got a £10 note.

That £10 would go so quickly, and I couldn’t just go to the ATM. The ATM in our village is nearly always empty.

All these little things that we take for granted suddenly become huge problems.

‘Protecting the cash system is essential for enabling millions of citizens to go about their lives,’ says Caroline Abrahams, charity director at Age UK.

‘Since it was still widely used during the pandemic, when spending opportunities were few, it’s going to be all the more important for us once we emerge from it and return to some kind of normality.

‘Older people who use cash and their local bank branch are finding it increasingly impossible to manage their money because more and more barriers are being put in their way.

‘They don’t want to give up their independence by having to rely on a family member or neighbour, they want to keep control of how they do financial things – but they don’t want to or can’t do it online.

‘It’s time for the Government to recognise how important banknotes and coins are to all our lives and treat the cash system as the essential piece of infrastructure it is – just like utilities, post and broadband.

‘If the Government is serious about ‘building back better’ after the pandemic, then they must legislate to protect cash access within a reasonable travel distance of people’s homes.’

Gareth Shaw, Which? head of money, says: ‘Cash continues to be a vital way to pay for millions of people, and it is clear that if the rapid transition to digital payments is not handled carefully, some groups of people – including older and vulnerable consumers – will end up being financially excluded.

‘These people cannot be left in a position where they are unable to purchase essential products and services because they cannot access or pay with cash.

‘The government must move swiftly with its legislative proposals to protect access to cash, so that effective action can be taken to maintain the viability of the cash system for as long as people depend on it.

‘Which?’s cash friendly pledge encourages retailers to continue accepting cash – and many have already signed up. However, legislation to protect cash must give the Financial Conduct Authority powers to monitor cash acceptance to establish if further action might be needed.’