Written answers

Tuesday, 24 January 2023

Photo of Brendan SmithBrendan Smith (Cavan-Monaghan, Fianna Fail)
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92. To ask the Minister for Finance the way he will be protecting banking services in rural areas, especially in relation to the right-to-cash services; and if he will make a statement on the matter. [3066/23]

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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In recent years, the banking landscape has changed significantly in Ireland.

The number of banks serving the sector reduced from 12 to 3 as banks were amalgamated or closed down and foreign owned entrants exited the Irish retail market. We have also seen a considerable acceleration in technological developments and the pace of uptake has been accelerated by the COVID-19 pandemic. With that has come a decline in cash usage. Since 2015 the number of ATM transactions declined by 46%. Card payments accounted for 62.4% of the total number of payment transactions in 2021.

Despite this decline, cash remains an important element of the payments system and the broader economy. I acknowledge its importance to certain sectors of the economy such as SMEs, as well as to older individuals or those who wish to use it as a means of controlling their finances.

However, there are costs associated with the cash infrastructure and this has incentivised traditional banks to move away from cash services, resulting in closures of branches, reduction or removal of cash services in branches, closures of ATMs and divestment of entire off-site ATM networks to independent operators.

In light of this changing landscape, in 2021 my predecessor as Minister for Finance instructed this Department to undertake a broad-ranging review of the retail banking sector.

The Retail Banking Review, published in November 2022, contained a number of recommendations. One recommendation was for the Department of Finance to develop Access to Cash legislation and prepare heads of a bill in 2023.

The Review also called on Department officials to prepare heads of a bill in 2023 to require ATM operators to be authorised and supervised by the Central Bank and to provide the Central Bank with responsibility and powers to protect the resilience of the cash system including the authorisation and supervision of cash-in-transit firms in respect of their cash handling activities and related financial services.

This work is now underway by officials in my Department.

Following consultation with the Central Bank and other stakeholders, the Department will establish what the appropriate levels of access to cash are to ensure that any further evolution of the cash infrastructure will be managed in a fair, orderly, transparent and equitable manner for all stakeholders. This will include an examination of the geographical spread of cash access and availability in both urban and rural areas.

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