The collaboration, achieved through the Access to Cash Action Group (CAG), which comprises of all major retail banks, Age UK, Toynbee Hall and the Federation of Small Businesses (FSB), marks the beginning of a long-term commitment to ensuring widespread cash and banking access for communities where services are limited.

Cash use has been in decline in recent years, with the trend accelerated and exacerbated by the pandemic. Current cash use is 35% below pre-Covid levels. However, millions of people across the UK still use cash daily. Banks and consumer groups alike recognise the need to ensure that consumers and small businesses who need cash can continue to withdraw and deposit it.

Under the new model, any community that faces the closure of a core cash service, such as a bank branch or ATM, will have its needs independently assessed by LINK. LINK will then determine whether a new solution should be provided to meet that community’s cash needs.

LINK, which already provides ATMs where communities need them, will commission services to meet the cash needs of the community as a whole – not just the customers or members of one bank or building society. Communities will also be able to request a review of their community’s needs from the summer of 2022.

LINK has already assessed most communities where closures have taken place over the past year. As a result, a number of new services will be provided in 2022, including 11 free-to-use ATMs and five new shared banking hubs.

The Access to Cash Action Group says these new shared services will complement other industry initiatives to support cash and banking, such as ‘cashback without purchase’ which is being rolled out to 2,000 retailers by the end of 2021. Other initiatives include mobile branches and pop-up services, as well as services for people who need to make payments in their own homes.

The decision to create shared banking services follows regional pilots across eight UK communities. As part of this, shared banking hubs were piloted in Rochford, Essex and Cambuslang, South Lanarkshire.

Natalie Ceeney CBE, chair of CAG and the Community Access to Cash Pilots, said: “I’m delighted that the industry is today committing to ensuring that the cash needs of consumers and small businesses up and down the UK will continue to be met. We know that demand for cash is declining, but we also know that it continues to play a vital part in the lives of at least 5 million people in the UK – including some of the most vulnerable in society. The community pilots have shown that there are many different ways to meet people’s cash needs. Informed by this experience, I’m confident that the new plan will lay the foundations for a positive future for cash access across the UK.”

Caroline Abrahams CBE, charity director at Age UK, said: “This is arguably the most promising development we’ve yet seen in ensuring that older people can continue to access cash, which so many of them rely on as an essential part of their everyday lives. It’s been great to be part of the Cash Action Group and we look forward to seeing the principles agreed by the group translate into action across the country, and really starting to make a positive difference for many older people.”

Anabel Hoult, Which? chief executive, said: “Which? called on banks to do more to protect access to cash, and pause their branch closure plans until solutions are in place, so it’s good to see proposals put forward that could make a real difference in securing the future of cash.

“The banks will now need to demonstrate that these measures deliver what is needed, and we will be watching closely to see the extent to which they prevent communities from losing access to cash.

“The government still needs to swiftly introduce its long-promised legislation to underpin these measures and ensure that consumers will continue to be able to access cash for as long as it is needed.”