Which? has called on the government to appoint a regulator to protect access to cash, as a combination of bank branch and cashpoint closures risks leaving people struggling to pay for essential goods and services.

Despite the increased popularity of digital and card payments, having access to cash is still a necessity for more than 25 million people across the country.

New figures obtained by Which? show cashpoints disappeared at a rate of 488 per month between June 2018 and December 2018, with over 250 free-to-use machines closing monthly due to changes in the way the UK’s cash machine network is funded.

Meanwhile, over the course of the year, 102 so-called ‘protected’ machines closed in more remote areas which receive boosted subsidies aimed at keeping them open.

Earlier today, the Treasury Committee held an evidence session with the Payment Systems Regulator (PSR), in which committee chair Nicky Morgan asked about the future of the UK’s ATM network.

Charles Randell, chair of the PSR, said that the whole system of access to cash needs to be looked at afresh, and that the PSR board will indeed look at the entire infrastructure of cash provision.

He said that there is a need to guarantee access to free-to-use ATMs, but with changes to the way people are using cash and contactless payments affecting the economics of the cash distribution industry, "we need to have a debate this year about whether access to cash should be a universal service, rather than a commercial one".

Morgan responded: “Whilst cash may no longer be king, it continues to play an important role in the lives of millions, so what we’ve heard today from the PSR should set alarm bells ringing.

“Mr Randell suggested that there is a serious discussion to be had this year about whether access to such a basic financial service should be universal, or commercially driven.

Morgan added: “With the way that people access their cash seemingly on the precipice of collapsing, the government can’t just bury its head in the sand, this mustn’t fall through the gaps of responsibility – the government and regulators should get a grip of this problem before the whole arrangement collapses.”

Research last November suggested that bank branches are set to disappear from UK High Streets by 2041, while ATMs will be a distant memory within 20 years.

Which? also noted recent analysis that banks are suffering at least one major security or IT glitch per week – with outages of Visa payments and IT failures across several UK banks causing chaos for millions of digital banking customers.

Jenni Allen, managing director, Which? Money, said: “Cash is a vital backup as fallible digital payments grow in popularity – so the government must appoint a regulator to oversee these changes and ensure no-one is excluded and left struggling to go about their daily lives.”

Which? previously found almost three-quarters of the population still use cash frequently to pay for goods and services, while a 2018 survey by the consumer group showed 61 per cent were negative about the idea of notes and coins ceasing to exist all together.

The campaign comes as banking research consultancy RBR published analysis that suggested payment cards were used for purchases with a value of $25.1 trillion worldwide in 2017, an increase of 13 per cent on the year before.

Although card expenditure is growing strongly, it is being outpaced by growth in the number of payments, as cards are increasingly being used for lower-value payments, often displacing cash in smaller retailers for goods such as drinks and snacks.

RBR forecasted global card expenditure will grow at an average of 10 per cent per year between 2017 and 2023 to reach $45.2 trillion.

The average value of a payment, however, will fall from $67 to $62 over the same period as the influence of contactless cards grows – the latter are typically used for the lowest-value payments, and particularly those which would previously have been made with cash.

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