The UK's Financial Conduct Authority has warned banks that every time they plan to close a branch or ATM they will need to provide an analysis of the impact on customers' access to cash.
The FCA says banks, building societies and credit unions are now expected to keep it informed of any plans to close branches or ATMs, or to convert ATMs to pay-to-use, in good time before any final decision is made.
These firms will need to provide a clear summary of their analysis of the needs of customers currently using the sites, the impact of the proposals on those customers, and alternatives that are, or could reasonably be, put in place.
If a firm decides to implement its closure or conversion proposals, it will be expected to clearly communicate information about this to its customers no less than 12 weeks before implementation, making people aware of alternatives.
Concern has been growing for years about the removal of fee-free ATMs and bank branches in small communities, which is leading to the creation of 'cash deserts' that leave vulnerable groups such as the elderly.
Last year, the independent Access to Cash Review said the UK is not ready to go cashless and set out a series of measures necessary to ensure no one is left behind as the country moves towards a digital society.
In March, with the Covid-19 pandemic hitting cash usage, the government committed to legislating to protect access to cash for as long as people need it.
Sheldon Mills, interim executive director, strategy and competition, FCA, says: "Even during the pandemic, cash remains essential to many consumers. The publication of this guidance sets out clearly our expectations on firms and will ensure that firms make it a priority that customers are treated fairly, especially those who are most vulnerable."