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More than 400 UK Banks, Building Societies and Credit Unions are planning to close their branches and removing their ATM / Cash Machines, but they will need to contact the City Regulator for clearance before any financial decision is made.
Financial Conduct Authority (FCA) Regulates the financial services industry in the UK by protecting the interests of consumers, promoting effective competition, protects the financial markets and more. In line with Banks, Building Societies and Credit Union that are planning to close the Financial Conduct Authority (FCA) provided Financial Guidance which is clearly detailed on their website, via the FG20/3 Branch and ATM closures and conversions issued September 2020. This ensures that customers are treated fairly.
What is the Financial Conduct Authority (FCA) And Their Objectives?
Here Are Some Very Important Points That Are Listed On Their Website
Section 1.11: The guidance makes it clear that we expect firms to keep us informed, via their usual supervisory contact, of plans for closures or conversions throughout the process, to enable us to monitor whether customers are being treated fairly. This engagement with the FCA should start in good time before the firm takes a decision and continue throughout the process.
Section 1.12: As part of developing proposals for decision, we expect firms to analyse the needs of customers currently using the sites, the impact of the proposals, and alternatives that are or could reasonably be put in place if they implement the proposals. We expect to be provided with a clear summary of the results of this analysis, and we may ask the firm for further analysis if we are not satisfied.
Section 1.13: If the firm decides to progress its proposals, we expect it to clearly communicate information about proposed closures or conversions to its customers no less than 12 weeks before a proposed closure or conversion would be implemented. We also expect it to communicate existing alternative ways to access services or ways it will make alternative access available.
Section 1.14: At the point the firm communicates the information referred to in paragraph 1.13, it should publish summaries of the analyses referred to in paragraph 1.12. We do not expect firms to publish confidential information as part of this. A wide range of customers use cash and bank branches, including those who are in vulnerable circumstances. Data from the 2020 Financial Lives Survey (FLS) shows that among all UK adults, 11% state that they rely on cash to a great or very great extent. A slightly higher proportion (16%) of adults with one or more characteristics of vulnerability state that they rely on cash to a great or very great extent. One in 10 UK
adults said that they did not know how they would cope, or that they would not cope at all, in a cashless society, which rose to 16% for customers with one or more characteristics of vulnerability. This is broadly consistent with the findings of the Access to Cash Review, which found that 17% of the UK population said they would struggle to cope in a cashless society.
Further Instructions Before Proceedings To Close A Financial Institution
Clear communication is expected for customers to receive no less than 12 weeks before going ahead with plans to close branches or remove ATM / Cash Machines. Customers will also need time to switch banks and be notified of alternatives. Payment Systems Regulator (PSR) monitors and ensures that the payment system works for us all. The Financial Conduct Authority (FCA) is working closely with them to ensure that access to cash is maintained.
The Financial Conduct Authority (FCA) Guidance applies from 21st September.
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