Redefining Access to Cash in an Aging World

Fintech for Longevity
August 11, 2023

In today's fast-paced world, digital transformation is occurring at an exponential rate, transforming the way we live, work, and even retire. While these advancements have brought immense benefits, they have also created a digital divide, leaving many individuals and communities behind. As digital financial services continue to evolve, the financial sector must prioritize personalized solutions that cater to the ever-changing needs of underserved communities including older adults.

Digital financial inclusion is defined by the World Bank as “the deployment of the cost-saving digital means to reach currently financially excluded and underserved populations. With a range of formal financial services suited to the needs of the underserved, digital tools should be responsibly and affordably delivered ”. As shown in the illustration below, the WB’s definition of digital financial inclusion is based on four layers;  a

ccessibility, affordability, usage, and delivery, whereas the accessibility layer is the foundation of the rest of the three layers.

Digital Financial Inclusion defined by the WB (illustration by F4L Academy)
The growing trend of population aging and the dramatic shift to online banking, create barriers to accessibility for a substantial group of older adults. While many customers still value personal interactions when managing their personal finances, the idea of brick-and-mortar branches has been institutionalized as a threat to the bottom line of banks. Therefore, there is a need for new “out-of-the-box” solutions not only for the benefit of customers but also as a way to incentivize banks to maintain their presence. 

Those who were in London in the past two years were probably surprised to see how a cashless society became a true reality in the day-to-day life of this hectic city. Even street beggars are collecting money with contactless EMV terminals to overcome the scarcity of coins and notes held by the crowd. In contrast to this trend, there are still communities across the UK that are cash dependent, such as small businesses like floral shops, pubs, barber shops, and others. The latter groups are often forced by the digital financial inclusion agenda which does not adhere to their personal preferences and needs.  

Access to Cash Action Group 

As of 2021, The Access to Cash Action Group has committed to finding new models to support consumers who depend on cash in the UK. The latter group was established by UK Finance, a few of the largest retail banks, and building societies, with the mission to preserve access to cash for consumers and businesses. The Access to Cash Action group is continuously looking for new banking models, particularly for small businesses, the elderly, and other underserved communities; 

Each time a core banking service such as an ATM or bank branch is closed, an assessment is carried out by Link - the organization which currently oversees the UK's ATM network. The review studies the cash needs of the community, such as how easy it is to travel to the nearest alternative service, as well as the demographics and vulnerability of local residents. The criteria are set by a group of banks and consumer representatives. LINK is governing organization that runs the infrastructure behind the ATM network in the UK. Back in 2019, LINK  launched a community request scheme allowing any member of the public to apply for an ATM in their community.

Measuring the preferences in the use of cash

A recent survey by the Banco de Espana measured the preferences in the use of cash according to different characteristics such as gender, age, education and geography. As shown in the graph below, the age group of 55-64 years old has the highest percentage of cash preference, slightly higher than their older counterparts. This means that a larger proportion of people in this age bracket (55-64) prefer to make payments in cash as compared to other age groups.


This could be due to various factors such as comfort level with traditional payment methods, reluctance to adopt new technology, or simply the fact that the 55-64 age group may be less likely to engage in online shopping or e-commerce. It is possible that even though the percentage of cash usage is high in the 55-64 age group, the total number of cash transactions may be lower than in younger age groups due to differences in spending patterns or income levels.

Access to cash has become increasingly important in Spain, and therefore the Banco de Espana has generated a specific index for identifying and measuring the cash shortage across the country. This index, called the “Acces to Cash Vulnerability Issue” can be viewed as an early warning indicator that can help in the identification of communities that are more likely to become financially excluded. 

The index is built based on the following indicators:

  • Supply and demand data at the municipal level:  
  • Number of points of access to cash per thousand inhabitants;  
  • Distance in kilometers to the closest point of access to cash;  
  • Average disposable income per person; 
  • The proportion of people over 60 years old

In the application of the proposed index, it was found that the vulnerable are characterized by elderly people who live in rural areas, travel an average of 7 kilometers to the closest access point and live in municipalities of less than 2000 inhabitants. For example, it has been found that the population residing in the Spanish province of Ávila (part of Leon area), has been affected by financial exclusion. Ávila is facing significant difficulties in accessing cash. In fact, 81.5% of the municipalities of the province of Ávila present a score of zero points in the access to the cash index. 

Ávila with its town walls
Ávila in Spain is located in the autonomous community of Castile and León. Picture By Anual - Own work, CC BY 3.0,
Each inhabitant living in Avila must travel, on average, approximately 20 km to access a cash dispensing point. This problem is aggravated when considering the southwest quadrant of the province of Ávila, where the distance is increased to an average of 30 km. 

Given the need for more access to cash in Spain, there are several innovative solutions that have emerged in recent years. Here are some examples:

Nickel: Nickel is a French fintech company that operates in Spain and offers cash withdrawals and receipts at the lottery and tobacco shops. This service is convenient and accessible, particularly for those who live in areas where traditional banking services may be limited or unavailable.

N.26: N.26 is a German mobile bank that has gained popularity in Spain for its easy-to-use app and digital banking services. The app allows users to withdraw cash from ATMs and make payments using their smartphones, making it a convenient and secure option for those who prefer to do their banking digitally.

Correos app: Correos, the national postal service of Spain, has launched a mobile app that offers a range of financial services, including money transfers, bill payments, and cash withdrawals. The app is available to anyone, regardless of whether they have a bank account, and can be used at any Correos office or branch.

IADs: An IAD (Independent ATM Deployer) is a type of ATM that is not owned or operated by a bank. Instead, they are often found in public places like shopping centers, train stations, and airports. IADs are becoming more popular in Spain, as they offer a convenient way to access cash outside of traditional banking hours.

The Rise of Mobile Libraries and Banking Hubs

In addition to the solutions mentioned previously, there are other innovative ways to increase access to cash in Spain and the UK. One such solution is the collaboration between councils and Prosegur, a security company, to include ATMs at mobile libraries. Mobile libraries are a valuable resource in many communities, providing access to books and other educational materials to people who may not have easy access to a physical library. Adding ATMs to these mobile libraries, it provides a convenient and secure way for people to access cash while also providing educational resources.

Moreover, Prosegur Cash, a Spanish security company, has announced plans to install a hundred ATMs in as many municipalities of Castilla-La Mancha that have been affected by depopulation. The initiative is aimed at improving access to financial services in rural areas and supporting local businesses.

A banking hub is another solution for accessing cash. It is a location where a significant number of financial institutions, such as banks, investment firms, and other financial service providers, are clustered together. Banking hubs can be found in major financial centers around the world, such as New York, London, Tokyo, and Hong Kong. 

Being located in a banking hub provides financial institutions with several advantages, including access to a larger pool of potential clients, networking opportunities, and a deeper understanding of local regulations. Additionally, the proximity of multiple financial institutions in a hub creates a competitive environment, which can drive innovation and improve services for consumers.

In the UK, the hubs feature a counter service that is operated by staff from the Post Office, where customers of almost any bank can withdraw and deposit cash, make bill payments, and carry out regular banking transactions. In the future, there are plans to include private spaces where customers can speak to someone from their bank for support on more complex issues. Banks provide staff on rotation, so there should be trained specialists from different banks available on different days. 


To summarise, in today's fast-paced world, digital transformation is occurring at an exponential rate, and therefore, the financial sector must prioritize novel solutions that cater to the needs of underserved communities including older adults and others, by creating inclusive financial services and higher accessibility to cash. Access to cash indices and alternative cash models such as mobile libraries and Banking Hubs should be considered as efficient alternatives to brick-and-mortar banking. 

If you would like to learn more about this topic, you are invited to register to our mini-course "Unlocking age-friendly Banking"  Learn More...

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