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New proposals to keep cash in circulation welcomed

By January 29, 2024No Comments

The Chief Executive of Irish Rural Link has welcomed proposed legislation that will keep cash circulating in society as more people turn to digital payments.

Under plans being brought to Cabinet today by Minister for Finance Michael McGrath, shops and pharmacies will have to accept cash as part of plans to keep physical money in the economy, given that some people prefer to use it.

The Access to Cash Bill also gives the Central Bank powers to compel banks to provide ATMs in areas where people have difficulty withdrawing cash.

It is understood that Mr McGrath’s aim is to restore the number of ATMs to 2022 levels before Ulster Bank and KBC left the retail banking market.

Speaking on RTÉ’s Today With Claire Byrne programme, Irish Rural Link Chief Executive Seamus Boland said cash is still needed, despite the digital transition.

Mr Boland said the digital transformation is happening too fast and inconvenient for many.

“The digital transformation is happening too fast for thousands and thousands of people especially in rural areas, but also older people. And really this legislation or proposed legislation is indeed very welcome,” he said.

He added that it would be preferable if there was at least one coffee shop in every town that took both cash and cards.

Speaking on the same programme, one business owner said he moved to a cashless during the Covid-19 pandemic, which afforded him the ability to bring costs down by 10%.

Paul Dolan, who owns The Barn Gastropub in Glanmire in Co Cork, said those savings are then passed onto customers.

Mr Dolan said there is a huge saving to be made because taking cash can be very costly due to expenses associated with security companies to transport it, as well as bank charges.

“There’s no security cost, no bank charges, no servers running back and forth. It’s such a big difference,” he said.

Mr Dolan said the savings from being a cashless business allowed him to absorb the vat increases of 4.5% last September, rather than passing it onto customers.

He added that the business clearly marks itself as cashless and customers are accepting of it.

Banking & Payments Federation Ireland (BPFI) said it recognises the importance of cash for many consumers and small businesses.

But it said the criteria used to measure demand levels must be updated regularly to stay in step with changing consumer preferences.

It called for the legislation to be “flexible” and “forward-looking”, to allow the requirements to be reviewed and updated efficiently.

“As the legislation is developed, it is also imperative that there is a level playing field among market players,” the BPFI said in a statement.

“A level playing field is a vitally important component for the health of every business sector, and the financial services sector is no different.”

It added that the provision and cost of reasonable access to cash should be a “shared industry responsibility” across all current and future providers of cash and current accounts.

“Of equal importance is the issue of oversight and measurement of the legislative requirements of reasonable access to cash,” it added.

“We believe this should be the responsibility of the Central Bank of Ireland which is the designated Competent Authority in charge of supervising the financial services sector in Ireland and for regulating other aspects of the cash landscape.”

Article Source – New proposals to keep cash in circulation welcomed – RTE

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