I beg to move,
That his House has considered rural banking services.
It is a pleasure to serve under your chairmanship this morning, Mr Gray. I am grateful to other Members for attending the debate. It is hot outside but there is no reason it should be hot in here. This does not need to be a divisive debate and I hope we can talk about the positives and the negatives of the issue.
I want to cover both the availability of cash and the importance of banking infrastructure in rural areas. There is no doubt that the pandemic has forced businesses to adapt and accelerated a wider move towards digital payments. That is to be welcomed and I thank businesses across the country that have bent over backwards and adapted their systems to ensure that they can provide a service to isolated or elderly customers. However, I am concerned that this has implications for some members of society, particularly older and vulnerable people, who are much more likely to use cash. Lower income households and those without internet access are likely to be the most affected.
During the pandemic, cash use has declined, often in constituencies with higher levels of deprivation. In my constituency, cash withdrawals dropped by 55% in the first six months of the pandemic and in areas such as mine, where our broadband and mobile coverage is poor, cash is extremely important for rural businesses and individuals. I am grateful that the Government are listening on this and are proactive, as I know the Minister will outline later, and we have already made some good steps in that direction.
In 2019, the “Access to Cash Review” report highlighted the need for different Government bodies and regulatory authorities to work together to protect access to cash. That was then followed with a commitment from the Chancellor in his Budget to legislate to protect access to cash. In April 2021, the Government accepted an amendment to the Bill that became the Financial Services Act 2021, which would allow consumers to withdraw cashback from more retailers without having to make a purchase. We have a real-life example of that amendment working well in my constituency.
I have been working with the community access to cash group in Hay-on-Wye, which is a group of volunteers who have gathered together to focus on the problem of cash availability. I do not know if you know my constituency, Mr Gray, but Hay-on-Wye is a beautiful town and has a wonderful culture of striking out on its own. In fact, in 1973, Richard Booth, who appointed himself the king of Hay, declared Hay an independent kingdom, so we did not need to go through the Brexit referendum—it really was that easy.
As a result, Hay-on-Wye has a culture of fixing its own problems. I want to commend the group of volunteers who have been organising this. They got together after the final bank left the town in 2018. At the same time, the post office has been going through some turbulent times after the postmaster, Mr Steve Like, stepped down from the business. I want to thank Steve and his family, who have owned the post office in Hay-on-Wye for more than 60 years. It was the end of an era when he stepped down in June.
With those two pressures in mind, a group of volunteers led by Josh Green got together to tackle the issue of cash availability. As well as creating a scheme where customers from different banks can speak to a representative from their bank in the parish hall one day a month, they have got together a large group of businesses that are now offering cashback after the Government stepped forward with the change to the Financial Services Act 2021. I want to celebrate what those volunteers have done. It is a meaningful difference and proves just how important cash is.