Charity calls on FCA to secure older people’s access to cash through the pandemic and beyond

Charity deeply concerned that our headlong rush towards a cashless society is leaving some older people unable to pay their way 

Age UK has written an open letter to the Financial Conduct Authority (FCA) to help older and vulnerable customers who are struggling to get cash as the lockdown continues, saying that “we are now approaching a critical time in the crisis…for older people.” 

The letter asks the FCA to consider introducing guidance to force banks and building societies to offer further support for their older customers at this time, and to share the best practice that has emerged so far.

The Charity welcomes the speedy and innovative action that many banks have already taken to help their older customers by, for example, proactively contacting customers, establishing helplines, sending cash through the post and making it easier for people to get cash on older people’s behalf. 

However, many older people rely on cash as their default way of paying for a range of essential goods and services and the Charity says this group needs more help. It warns that the measures already introduced won’t be of much use to those older people who struggle with the new processes; for example those who have a health condition that limits their ability to talk to their bank. Failure to put in place an easy method for customers to receive cash would leave some of the most vulnerable people unable to pay for essential supplies. 

The letter also asks the FCA to ensure that banks do not discourage older people from contacting them when this is necessary for them.  Much of the messaging from banks, for example in national TV advertising campaigns, is encouraging customers to get in touch via their websites, creating the impression for many older people that they can’t call their bank or visit a branch. The FCA needs to ensure that customer facing communications are clear that people unwilling or unable to contact their bank electronically are still welcome to do so by other means. 

The latest figures show that a third (31%) of the 70 plus population in England, the equivalent of 2.3 million people, live in a household without access to the internet, while 43% of this cohort, the equivalent of 3.2 million people, have never used the internet at home or anywhere else. (1) They are highly unlikely to do so now and they must not be forgotten or left behind. 

Caroline Abrahams, Charity Director at Age UK, said:

“Many older people are particularly reliant on cash and so ensuring that cash supplies are uninterrupted is particularly important to them as lockdown continues. Should there be any problems, contingency plans must ensure that provision is made for people with mobility issues and those living in isolated rural areas to ensure they can continue to access their cash.

“It’s deeply worrying that some older people are telling us that their cash supplies have run out and they are worried about how they will pay for their shopping, and are concerned their supplies of essentials will run out soon if they have no means of paying for more.

“While we welcome the initiatives that companies are undertaking they don’t solve the problem for all older people. We are concerned that the most vulnerable will be the hardest hit as they will be unable to use the new services that have been established.  It is crucial that every bank does everything it reasonably can to help these customers, including going beyond the new services they have already established. 

“We hope all businesses can continue to look at how they can assist older people who depend on cash to go about their daily lives. The FCA can play an important role too by monitoring what they are doing, spreading best practice and introducing new guidance to ensure that vulnerable consumers receive an appropriate level of assistance if they need it.

“We welcome the actions businesses and the FCA have already taken to help customers access cash these last few weeks but more needs to be done, supported by clear direction from the FCA, so every older person is confident they can get the cash they need to pay their way.”

“Making sure that older people have the coins and banknotes they need to keep spending is surely in the best interests of businesses and the economy too, so the sooner a really comprehensive range of measures is in place to assure this the better for everyone.”

Reference

(1)The source of all these figures is: Age UK Analysis (April 2020) of Taking Part Survey 2017-18 [accessed 9th April 2020] and ONS mid-year population estimates 2018 [accessed 23rd March 2020].

SEE BELOW FOR THE LETTER

Mr C. Woolard

Interim Chief Executive

Financial Conduct Authority

Dear Mr. Woolard,

In the last few weeks, the UK has faced unprecedented circumstances as a consequence of the COVID-19 epidemic.

The epidemic has generated a unique set of challenges for the banking industry, as both consumers and firms seek to respond to the issues that the pandemic, and particularly the lockdown, has created.

We welcome the action that the FCA has taken to ensure that consumers whose finances have been impacted by the virus have been able to reduce their outgoings and in reminding firms of the need to support their vulnerable customers through this time. 

We are delighted that many firms have started to offer a wide range of different services to help such customers, often going above the FCA guidance, and they should be congratulated for doing so. We welcome the speed in which they – and the FCA - have acted, the wide variety of solutions to the problems customers are facing, and the innovation that many have shown. We particularly welcome several firms proactively contacting their older customers to see how they can help. 

However, we are now approaching a critical time in the crisis, in particular for older people. At present we have had two major areas of concerns highlighted to us by the older people who contact us and our network of local Age UKs, who are helping older people across the country.

Access to cash

There are two main problems for older people who are struggling to access cash:

• that the positive steps taken by many banks are not industry-wide, potentially leaving many older and vulnerable customers without access to cash, while the new solutions are not suitable for the very hard to reach customers ; 
• Misguided communication from banks that may prevent older customers needing help contacting them 

More so than their younger counterparts, older people are particularly reliant on cash for meeting their day to day needs, including buying food and other essential supplies. This is particularly so for those who are unable to get out the house or travel far, who are often more vulnerable and dependent on other people to get cash for them.

Over the last two weeks we have experienced an increased number of older people contacting us expressing concern that their cash supplies have been exhausted and they don’t know how they will be able to get cash to pay for their shopping or their domiciliary care, or are concerned their supplies of essential goods will soon run out.

While we welcome the initiatives that firms are undertaking, they don’t solve the problem of getting cash for all older people. We are concerned that many of the hardest to reach older people - someone who lives alone and has a cognitive impairment, for example - may be unable to use these new services. In these unprecedented times it is imperative that each and every bank takes every possible step to help these customers, including going over and above the new services that have already been established. 

We therefore trust – and that the FCA will expect – that firms will continue to look at how they can assist their hard to reach customers. The FCA has a particularly important role to play in monitoring what firms are doing, spreading best practices and – as you did with overdrafts, loans and credit cards – introduce guidance to ensure that vulnerable consumers can expect an appropriate level of assistance from firms.

We recognise that firms and the FCA have already achieved a great deal over the last few weeks to help customers access cash. However, continued action, supported by clear direction from the FCA in the form of guidance, is required to avoid issues accessing cash becoming a major problem for many of society’s oldest and most vulnerable people. 

Customer Communications

While the new measures are welcome, they will be ineffective without sufficient customer awareness. Effective communication to customers is vital, and we ask the FCA to ensure that all banks and other firms communicate with their older customers appropriately. This is particularly so for people who do not use smart phones or the internet, and who may also have difficulty accessing telephone banking services. 

While we appreciate that many firms are seeking to encourage customers to use electronic means of communication, rather than visiting branches or using call centres, we are concerned that the messaging that many firms are using is potentially confusing for older customers as it suggests that they should avoid getting in touch with them unless they can do so electronically. 

Any customer facing communications should make it clear that anyone unable or unwilling to communicate with their bank electronically is welcome to do so using other means. 

It is also important that telephone banking services are readily available, and that call centres can cope with demand. We have heard reports of older people facing long waits and then not being able to access the services they need. We do, of course, appreciate the difficulty for firms in scaling up such operations at short notice, but it is an issue which is likely to continue as long as older people are following Government advice not to go outside. Several firms have already established special helplines for their older and vulnerable customers, and all firms should be required to do so.

Finally, we would encourage banks to work with the Post Office, which has introduced and expanded its own schemes for helping customers access cash. It has opened out its ‘Payout Now’ and ‘Fast PACE’ schemes to banks, and we believe banks should be expected to facilitate access to these services for their customers. 

We recognise that firms and the FCA have already achieved a great deal over the last few weeks to help customers access cash. However, continued action is required to avoid issues accessing cash becoming a major problem for many of society’s oldest and most vulnerable people, and we look forward to working with the FCA to bring this about.

Yours sincerely

Caroline Abrahams 

Charity Director, Age UK