August 21, 2024 | JUERGEN KISTERS
Cash deserts, areas or regions where citizens lack access to cash services, are on the rise. People in these regions are often categorized as un- or underbanked. Some reside in rural areas where there have never been ATMs or bank branches. Others once had access to branches that have since closed, leaving them without local cash services. As a result, cash deserts are a global issue. Let’s look at an example.
Kielder in the United Kingdom holds the questionable honor of being the “remotest spot in UK’s cash desert”1. For residents who want to get cash, the nearest ATM is 18 miles away. Due to the winding lanes on the way, a round trip can take two hours or more, and that’s only if you can use a car; public transportation will take even longer. To reach a bank branch residents need to travel 30 miles. There used to be three, but they were all closed. It’s not just the residents who suffer from this situation. An official mentioned: 'Hordes of tourists come to enjoy our rural location but struggle to get hold of cash. An ATM or visiting mobile bank could be a godsend for our village.2
Digital and online banking can offer access to financial services, but several residents say that using these services is not out of choice. They are unfamiliar with computers, struggle with the processes and fear being vulnerable to hackers.
These are some of the reasons that are regularly quoted about why digital banking is not the ultimate solution for providing financial services in these un- or underbanked areas. Another issue is that over the last year we have seen several outages that made digital payments unusable at least for periods of time:
So, having cash available as a fallback in case the digital infrastructure goes down is essential to ensuring business can continue even during an outage. This is especially critical in remote rural areas where connectivity can often still be spotty.
Sweden is often used as the prime example for a country that was expected to go cashless soon. However, recently it has made efforts to ensure access to cash will be guaranteed. And experts suggested that Sweden would go fully cashless in 2023 –that date has come and gone. The head of Sweden’s Riksbank explained that they believe it should always be possible to pay for at least the most important goods and services with cash to ensure financial inclusion.4 They followed up statements like this with action: Sweden’s parliament has passed a law requiring citizens to have access to cash—at least in the form of an ATM—within 25 kilometers of where they live.5
There are several reasons why cash continues to be essential and, consequently, why cash deserts need to be taken care of and equipped with access to cash services as soon as possible:
How can we get rid of cash deserts? As the official from Kielder already mentioned in his statement: Installing ATMs in these underbanked regions provides access to cash services at a relatively low cost. Especially considering the fact that modern devices like Diebold Nixdorf’s DN Series® self-service devices are more available, requiring fewer visits from service technicians or cash-in-transit services. This is thanks to the years of engineering experience that go into its design, ensuring fewer out-of-service events, and the high capacity of its cash cassettes. DN Series was purposely built as an IoT device for data-driven service excellence. Should an outage occur; the device can share information about the likely cause, making a solution after just a single visit much more likely. As such it is well suited to being installed as a leave-behind strategy in un- or underbanked regions and to solve the issue of cash deserts.
If you’d like to learn more about the DN Series ATMs, contact your Diebold Nixdorf representative today.
