News in Brief

Payment Choice Act Proposed in US

A number of states and cities in the US have implemented or are considering legislation to make cash acceptance at retailers mandatory, but a bill has been put forward to make it illegal for retail businesses to reject cash for in-person consumer transaction at shops throughout the US. The bill has 28 co-sponsors drawn from both political parties.

The rationale for the Payment Choice Act 2021 is to safeguard the 55 million Americans who need cash to live day-today from being left out of the economy where cash is banned. Privacy is also cited, with recent company data breeches highlighting the need for payment choice. Finally, the US experiences a range of natural disasters each year. When disaster strikes and the power is cut, cash is needed.

Separately, new legislation has been passed in Colorado requiring US currency to be accepted as payment for goods and services. Violation is a class 2 petty offence punishable with a fine of up to $500.

ATMs and Branches Destroyed in South Africa

Recent lawlessness in KwaZulu-Natal and Gauteng in South Africa has seen about 1,400 ATMs and nearly 300 bank branches and post offices damaged or destroyed. The scale of the damage means replacement or repairs will take a long time even when order is restored. The resupply of working ATMs will also be delayed until safety can be assured.

Given the role of ATMs in a cash-based society, this level of destruction is likely to severely affect cash circulation. The Banking Association of South Africa has said that beneficiaries of the monthly grant money provided by the South African Social Security Agency will be affected in these two provinces by the disruption to ATMs and branches.

G+D Invest in CBDC Testing Software Company

Giesecke and Devrient (G+D) has invested in UK-based FNA (Financial Network Analytics), a deep technology firm specialising in advanced network analytics and simulations. FNA makes simulation software to allow the impact of introducing a Central Bank Digital Currency (CBDC) on financial and economic systems to be tested as part of regulator and institutional preparations.

According to G+D, its strategic investment is designed to allow FNA to accelerate innovation and build additional resources, as well as to develop its CBDC simulation software further. The investment will also support ongoing global growth and reinforce recent major customer acquisitions. As part of the transaction, G+D will join the company's board as observers.

Cash Essentials Wins Awards for Promoting Cash

The ATMIA International Marketing Forum presents annual awards, known as ATMmys, for a number of categories for organisations that have creatively promoted cash and ATM products and services to businesses and consumers. Cash Essentials won first prize in the Digital category for its ‘Live Free. Pay Cash’ campaign and second prize in the Cash Promotion category for its YouTube video ‘The Cash Cycle in Disaster’.

Even though the ‘Live Free. Pay Cash’ campaign was limited to France, it reached 40 million people within five weeks of being launched in October 2020. It was used on Facebook, native and display advertising media and shared the message about the security and privacy of cash.

The ‘Cash Cycle in Disaster’ campaign consisted of six videos designed for aid agencies to understand the wide range of issues and how cash is managed in a crisis. It had 300,000 views on YouTube.

UK Consultation on Access to Cash

Last year the University of Bristol was commissioned to map the geographic coverage of cash access points across the UK. It found around 90% of neighbourhoods were within one kilometre of a free cash access point. The consultation believes this is a reasonable level to be sustained both for depositing and withdrawing cash, whether by an individual or a business.

The government wants the target to be flexible so that it can be amended to reflect changing consumer demand. The definition of what is reasonable access would be defined in regulation rather than in law.

There are a number of government bodies involved in cash payments in the UK. This consultation suggests that the Financial Conduct Authority should be the lead organisation responsible for cash, including setting regulations.

Spain Reduces Cash Limits Again

The Spanish Congress has just approved a reduction in the cash payment limit from €2,500 to €1,000 for virtually every type of transaction for goods and professional services. The logic is this will ‘facilitate traceability of transactions, and will make it more difficult to incur in fraudulent practices’ according to the government.

Recognising the reality that criminals are just as happy using cryptocurrencies, the act requires taxpayers to declare their crypto holdings whether in Spain or abroad, and any transactions involving them.

Trade groups in Spain have lined up to criticise the decision, arguing that it reduces consumer demand, removes consumer choice, increases payment costs, does not get to the heart of tax evasion and has not made any difference in countries like France, which has similar legislation.

Shrap Runs Two Live Trial Sites

The CashTech start up Shrap aims to remove the need for coins by the use of a card and app. The idea is that transaction change is given on a Shrap card or Shrap’s mobile app. The value on the card can be spent in shops or transferred person-toperson. Shrap transactions are anonymous and free. Businesses maintain a ‘float’ with Shrap, with change issued through the app or the point-of-sale terminal. Shrap makes money by the interest earned on the cash it holds.

Shrap has now started live trials in Rochford in Essex and Denny in Scotland. Both are part of the UK’s Community Access to Cash pilot scheme.

Lithuania to Increase Access to Cash

According to the Bank of Lithuania, on 9 June 2021, 1,044 bank ATMs operated in Lithuania. 73% of the population lived within 5 km of an ATM and 82% within 10 km. The Bank of Lithuania has now signed an ‘Ensuring Access to Cash’ memorandum of understanding with nine financial and credit institutions to double the number of cash localities with cash withdrawal facilities within a year.

The aim is to double the number of localities with more than 4,000 residents with an ATM from 91 to 191 within 12 months. This will mean 90% of citizens are within 10 km of an ATM, or alternative access point, and 99% within 20 km. Cash must be available for at least 12 hours per day.