To ask the Chancellor of the Exchequer, when his Department plans to publish its response to the call for evidence on cash and digital payments in the new economy that closed on 5 June 2018.

To ask the Chancellor of the Exchequer, when his Department plans to publish its response to the call for evidence on cash and digital payments in the new economy that closed on 5 June 2018.

To ask the Chancellor of the Exchequer, what assessment he has made of the potential effect of a cash-less economy on taxation revenues.

To ask the Chancellor of the Exchequer, what assessment he has made of the potential effect of a cash-less economy on taxation revenues.

To ask the Chancellor of the Exchequer, with reference to the consultation, Cash and digital payments in the new economy, published in December 2017, whether his Department has made an assessment of the effect of the increase in cashless and electronic payments on homeless people.

To ask the Chancellor of the Exchequer, with reference to the consultation, Cash and digital payments in the new economy, published in December 2017, whether his Department has made an assessment of the effect of the increase in cashless and electronic payments on homeless people.

Letter dated 05/07/2018 from Lord Bates to Lord Marlesford regarding whether retailers of goods and services are legally obliged to accept cash. 1p.

Letter dated 05/07/2018 from Lord Bates to Lord Marlesford regarding whether retailers of goods and services are legally obliged to accept cash. 1p.

To ask Her Majesty’s Government what assessment they have made of the impact on financial exclusion of (1) bank branch closures, and (2) moves to restrict the use of cash as a means of payment.

To ask Her Majesty’s Government what assessment they have made of the impact on financial exclusion of (1) bank branch closures, and (2) moves to restrict the use of cash as a means of payment.

My Lords, the Government are committed to financial inclusion. Along with the FCA, we are taking steps to ensure that everyone has access to useful and affordable financial services, including face-to-face banking services and free access to cash. The Government recognise that banking and ways of making payments are changing rapidly, but we do not make assessments of branch closures or payment methods.

My Lords, the Government are committed to financial inclusion. Along with the FCA, we are taking steps to ensure that everyone has access to useful and affordable financial services, including face-to-face banking services and free access to cash. The Government recognise that banking and ways of making payments are changing rapidly, but we do not make assessments of branch closures or payment methods.

My Lords, I thank the Minister for his response. I am sure that he is aware that since 2015, some 2,900 bank branches have closed in the UK, and that only last year, the banks removed some 2,000 ATM machines, despite the fact that cash remains a very popular choice for many consumers. Does he agree that the increasing lack of face-to-face banking services, particularly in rural areas, not only threatens the financial exclusion of particularly vulnerable groups—I am thinking in particular of older people and those with limited mobility—but risks disrupting the entire cash economy in local communities, especially shops and small businesses? Given that, what concrete steps do the Government intend to take to ensure that physical banking facilities and cash payments remain available to all who want and need them?

My Lords, I thank the Minister for his response. I am sure that he is aware that since 2015, some 2,900 bank branches have closed in the UK, and that only last year, the banks removed some 2,000 ATM machines, despite the fact that cash remains a very popular choice for many consumers. Does he agree that the increasing lack of face-to-face banking services, particularly in rural areas, not only threatens the financial exclusion of particularly vulnerable groups—I am thinking in particular of older people and those with limited mobility—but risks disrupting the entire cash economy in local communities, especially shops and small businesses? Given that, what concrete steps do the Government intend to take to ensure that physical banking facilities and cash payments remain available to all who want and need them?

Perhaps I may first pay tribute to the noble Baroness for her work as chair of the ad hoc Financial Exclusion Committee of this House, which provided important recommendations which the Government are steadily working to implement. The issue she raises is an important one. The way we pay for things is changing, as is how we use banks. Cash used to account for 60% of transactions. That has reduced to 40% of transactions and is predicted to go down to 20% by 2026. As I say, the way that banking is carried out is changing. However, we recognise that there is a particular issue for vulnerable people and vulnerable communities. For that reason, in January 2017 we launched the banking framework agreement between the high street banks and post offices. Some 98.7% of people live within three miles of a post office,

even those in rural communities. We have introduced the Payment Systems Regulator, which monitors ATM machines to ensure that they are maintained as a source of free access to large parts of the community. We have a great deal to keep under review, but this is an important issue that the noble Baroness and the Government are very aware of.

Perhaps I may first pay tribute to the noble Baroness for her work as chair of the ad hoc Financial Exclusion Committee of this House, which provided important recommendations which the Government are steadily working to implement. The issue she raises is an important one. The way we pay for things is changing, as is how we use banks. Cash used to account for 60% of transactions. That has reduced to 40% of transactions and is predicted to go down to 20% by 2026. As I say, the way that banking is carried out is changing. However, we recognise that there is a particular issue for vulnerable people and vulnerable communities. For that reason, in January 2017 we launched the banking framework agreement between the high street banks and post offices. Some 98.7% of people live within three miles of a post office,

even those in rural communities. We have introduced the Payment Systems Regulator, which monitors ATM machines to ensure that they are maintained as a source of free access to large parts of the community. We have a great deal to keep under review, but this is an important issue that the noble Baroness and the Government are very aware of.

My Lords, the Minister will be aware that post offices have taken up a lot of the slack caused by the closure of banks, but post offices close down as well and they do not offer the suite of services that banks can. People who are still dependent on cash are being squeezed even more. While I join the Minister in congratulating the noble Baroness, Lady Tyler, on her work with the ad hoc committee, perhaps I may press him to agree that simply passing the buck to post offices does not solve the problem.

My Lords, the Minister will be aware that post offices have taken up a lot of the slack caused by the closure of banks, but post offices close down as well and they do not offer the suite of services that banks can. People who are still dependent on cash are being squeezed even more. While I join the Minister in congratulating the noble Baroness, Lady Tyler, on her work with the ad hoc committee, perhaps I may press him to agree that simply passing the buck to post offices does not solve the problem.

I accept what the noble Lord says, but one of the points about the ground-breaking nature of the framework agreement with post offices on banking services is that 99% of personal financial services can now be transacted at the post office. That is helping to keep post offices open as an important part of the community. Some 95% of banking services can be provided by post offices as well. However, although this is a ground-breaking development, we are keeping it under review.

I accept what the noble Lord says, but one of the points about the ground-breaking nature of the framework agreement with post offices on banking services is that 99% of personal financial services can now be transacted at the post office. That is helping to keep post offices open as an important part of the community. Some 95% of banking services can be provided by post offices as well. However, although this is a ground-breaking development, we are keeping it under review.

My Lords, does my noble friend agree that, while in no sense contradicting what the noble Baroness has said, there is a key role for fintech to play in addressing financial inclusion? Will the Government look at all the opportunities arising in fintech and consider promoting them to all vulnerable consumers?

My Lords, does my noble friend agree that, while in no sense contradicting what the noble Baroness has said, there is a key role for fintech to play in addressing financial inclusion? Will the Government look at all the opportunities arising in fintech and consider promoting them to all vulnerable consumers?

Again, as another member of the ad hoc Financial Exclusion Committee, my noble friend initiated an important debate on the digital economy. We do believe that fintech, in which the UK is a leading force in the world, can be a powerful way of introducing significant change in this area for the benefit of those who need it.

Again, as another member of the ad hoc Financial Exclusion Committee, my noble friend initiated an important debate on the digital economy. We do believe that fintech, in which the UK is a leading force in the world, can be a powerful way of introducing significant change in this area for the benefit of those who need it.

My Lords, the Financial Conduct Authority estimates that 2.7 million people are stuck with permanent overdrafts and are using them more than 85% of the time, thus incurring higher and higher charges. Can the Minister tell us what measures the Government are putting in place to end the cycle of persistent debt and whether they will commit to imposing a cap on overdraft fees?

My Lords, the Financial Conduct Authority estimates that 2.7 million people are stuck with permanent overdrafts and are using them more than 85% of the time, thus incurring higher and higher charges. Can the Minister tell us what measures the Government are putting in place to end the cycle of persistent debt and whether they will commit to imposing a cap on overdraft fees?

We have done a lot in that area, such as capping payday loans—those egregious payments. The Financial Conduct Authority has looked at the whole issue of buy to rent and is considering whether a cap is necessary. We have also done a number of things to try to help those with low incomes to improve their situation. My noble friend Lord Young took the Financial Guidance and Claims Act, which created a new single financial guidance body, through this House. All these measures

are designed to improve the situation. We also announced our ambition to increase the number of people who have access to credit unions in this country from 2 million to 3 million.

We have done a lot in that area, such as capping payday loans—those egregious payments. The Financial Conduct Authority has looked at the whole issue of buy to rent and is considering whether a cap is necessary. We have also done a number of things to try to help those with low incomes to improve their situation. My noble friend Lord Young took the Financial Guidance and Claims Act, which created a new single financial guidance body, through this House. All these measures

are designed to improve the situation. We also announced our ambition to increase the number of people who have access to credit unions in this country from 2 million to 3 million.

My Lords, is the Minister aware of the attempts being made by the Post Office to make cash available to named individuals by arrangement with their bank when they are unable to manage cash withdrawal at an ATM, for example if they have a learning disability or may be at risk of financial exploitation?

My Lords, is the Minister aware of the attempts being made by the Post Office to make cash available to named individuals by arrangement with their bank when they are unable to manage cash withdrawal at an ATM, for example if they have a learning disability or may be at risk of financial exploitation?