Press release
Minister McGrath secures government approval for Access to Cash legislation
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Published on
Last updated on
The Minister for Finance Michael McGrath has today (23 January 2024) published the General Scheme of the Access to Cash Bill following approval by Government at this morning’s Cabinet meeting.
The Access to Cash Bill stems from a recommendation made by the Retail Banking Review, published in November 2022.
The Review highlighted the continuing importance of cash in ensuring that people do not experience financial exclusion, that consumers can budget efficiently, and that there is a safety net in the event of electronic banking or the payments infrastructure being impacted by outages or cyber-attacks.
Minister McGrath commented:
“The move to a more digitalised banking model, along with the costs involved in handling cash, have incentivised the traditional banks to move away from cash. Although cash usage has declined in recent years, and this decline accelerated during the pandemic, it is important to protect its role in our society and economy in the future. It is also very important that future changes are managed in a controlled, fair and transparent manner. In the absence of a legislative intervention, it is likely that over time we would see more and more ATMs removed from communities across the country and I do not want to see this happen.
"In addition to protecting ATM availability, it is important that they are properly maintained and that the ‘out of service’ experience of consumers is kept to a minimum. Therefore, this Bill provides the Central Bank with regulation making powers in relation to matters such as reporting, setting service standards, and other matters such as denomination stocking.
"Allied to access to cash, plans to ensure the ability to spend cash in certain settings are also being advanced. This Access to Cash legislation coincides with the National Payment Strategy, which is currently being developed by my department. That Strategy will, among other things, look at the acceptance of cash in the future payments system. As part of the development of the National Payment Strategy, a public consultation is currently being undertaken and I would encourage everyone who has interest in the role of cash in our society to have their say as part of that process.
"We have to ensure that people are not left behind and we must avoid the risk of financial exclusion. We must recognise the important role that cash continues to play in all our lives, and this is a role I am determined to protect.”
The Review also called on department officials to require ATM operators to be authorised and supervised by the Central Bank and to provide the Central Bank with responsibility and powers to protect the resilience of the cash system - including the authorisation and supervision of cash-in-transit firms in respect of their cash handling activities and related financial services.
The General Scheme published today incorporates both of these elements in one piece of legislation. The legislation will for the first time regulate ATMs with the objective of improving operational standards and ensure good customer service.
In order to draft the General Scheme, the department has engaged with the Central Bank and key players in the cash system in order to establish what the appropriate levels of access to cash are to ensure that any further evolution of the cash infrastructure will be managed in a fair, orderly, transparent and equitable manner for all stakeholders.
The General Scheme can be found at: Access to Cash General Scheme.
Public consultation on National Payments Strategy due to close 14 February 2024: National Payments Strategy: Public Consultation.
The Access to Cash Bill intends to ensure the continued reasonable access to cash in the State. The Department of Finance’s 2022 Retail Banking Review found that there is a reasonable level of cash access in the State, but it noted that there is no framework to maintain reasonable access to cash into the future.
The Access to Cash Bill aims to establish a framework to provide that any future evolution of the cash infrastructure will be managed in a fair, orderly, transparent, and equitable manner, by establishing that infrastructure is preserved at approximately December 2022 levels initially, accounting for the exit of KBC and Ulster Bank.
The Bill requires compliance with regional criteria that set the minimum numbers of ATMs per 100,000 people, and the proportion within 10km of an ATM and a cash service point. Responsibility for compliance rests with the designated entities who will be the three main retail banks in the first instance.
The Bill designates the deposit-holding entities, whose share of current accounts and household deposits exceed percentages to be prescribed by the Minister, who will be responsible for maintaining access to cash levels, and it provides for supervision by the Central Bank of ATM operators and Cash-in-Transit firms (CITs).
Cash service points are locations where cash can be deposited and withdrawn, during normal business hours, where in-person assistance is available. Bank branches and An Post offices satisfy this definition.
The Central Bank will be responsible for the monitoring and enforcement of the legislation and will have the necessary powers to ensure compliance with the access to cash criteria.
The regions for this Bill will be the NUTS3 regions under the nomenclature of territorial units for statistics classification, relied on by the European statistical agency Eurostat. There are eight NUTS3 regions in Ireland.
The Bill also provides for the remedying of local deficiencies. These are locations within a NUTS3 region where particular difficulties arise in accessing cash. The Central Bank will assess such cases and, where warranted, may require designated entities to address the issue. The Central Bank will prepare and publish guidance on local deficiencies prior to implementation of the framework.
Prior to the pandemic, just under €20 billion was withdrawn from ATMs in the State and the figure for 2022 was about €13.5 billion. This is a decline of just under a third.
In terms of ATM transactions, the decline from pre-pandemic to 2022 is nearly 45%, from around 156 million to 87 million. The average value per withdrawal was c.€154 in 2022 versus €133 in 2019, and €122 in both 2015 and 2016.
The supplementary material sets out the relevant data on the NUTS3 regions and December 2022 levels of access to cash.