Finalised guidance on branch and ATM closures or conversions

Financial Conduct Authority Page 1 of 19
Finalised guidance
FG 20/3: Branch and ATM closures or conversions September 2020

Guidance consultation
Financial Conduct Authority Page 2 of 19
Finalised guidance
1 Summary
Who this guidance affects
1.1 This guidance applies to regulated firms that operate (or have agents operate) branches,
or ATMs (cash machine or cashpoint), and who are subject to Principles 6, 7, and 11 of our Principles for Businesses. It applies when such a firm proposes or takes a decision to close such sites, or to convert a free-to-use ATM to pay-to-use, with some exceptions (see paragraphs 2.4-2.9).
1.2 A branch is the physical site where firms undertake regulated banking activities or
provide regulated payment services for their customers, whether consumers or small and medium enterprises (SMEs), who attend in person (see paragraphs 1.7-1.8 for more detail on the definition of customers). This includes a bank or building society branch, or a credit union office, or a mobile branch.
1.3 We will be mindful of proportionality when considering how a credit union has followed
this guidance. In practice, the implications are likely to vary according to the size and complexity of the credit union. This is in line with our general approach to applying the Principles to credit unions (see CREDS 10.1.3G).
1.4 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. What this guidance relates to
1.5 Paragraphs 2.18-2.37 of this guidance build on Principles 6 and 7, and so apply only to
services covered by these Principles. Firms should note that Principles 6 and 7 not only apply to the carrying on of regulated activities, but also activities that are ancillary to the regulated activity of accepting deposits, credit-related regulated activity, regulated home finance activity and some other regulated activities. They also apply to activities connected to the provision of regulated payment services as well as the provision of the payment services.