Acceptance of Cash Payments Review (S.R.1/2025): response of the Minister for Sustainable Economic Development

Findings

Comments

1

Digital payment transactions are likely more prevalent than cash payments within the Island, however specific data identifying this is limited. Although the rate of reduction has slowed since 2020, there has been an overall trend of reducing demand for cash in Jersey, with a reported drop in the number of payments being made in cash. This mirrors the United Kingdom where a further reduction in cash use is forecast and there may be a point that the number of organisations accepting cash payment is reduced to a point where it is effectively removed as an option.

This customer led trend is noted in respect of the UK, but both the UK Government and Jersey have indicated  that  they  will  support  the  continued circulation of cash for use by those businesses and individuals who wish to.

2

A small amount of submissions dealt with those individuals or charities that still used cheques, the Panel does not have sufficient evidence to draw conclusions on the impacts in this area

Noted.

Findings

Comments

but notes they are also subject to banking charges and practices which may vary from institution to institution.

3

Although examples were given of older people being receptive to digital technologies and able to use these to make payments, it would appear that this group, the island's demographics, skills, technologies, and reliance on and use of, either digital or cash payments is likely to alter in future years.

Noted.

4

Other groups were highlighted as preferring or and benefiting from a wide range of payment methods. Digital payment methods were highlighted by some as potentially challenging for those who face physical or mental impairment, however some outlined that they also benefited from technology, with further evidential data in the area being called for to justify any mitigating actions. Those with lower household income seem more likely to carry and therefore use cash, compared to those with the highest household incomes. Visitors to the Island are also likely to carry and use cash with Jersey's currency adding to its tourism offering and unique cultural identity.

Jersey's currency is highlighted by Visit Jersey on their  website, providing information to visitors and drawing attention to this aspect of the Island's unique identity.

5

The availability of cash and access to it is an important factor in how people pay for goods and services. The panel received evidence of a variety of experiences about the provision of ATMs, cash-back and cash wages.

Noted.

6

Elements of regulatory protection for cash access are found in the United Kingdom through the Financial Services and Markets Act 2023. Access to bank branches may also impact upon payment method choices, for both individuals and businesses in terms of increasing travel time and

This is correct although it should be noted that the UK does not provide for a statutory right to pay in cash and, as in Jersey, businesses remain free to determine  which  methods  of  payments  they choose to accept.

Findings

Comments

costs, with concern being raised over further branch closures.

7

There are Islanders who are unable to hold bank accounts for various reasons. This is likely to restrict their choice of payment methods. Jersey Community Savings provides a number of services to aid those unable to access mainstream banking services, including provision of digital payment methods and access to cash via ATMs or Jersey Post.

Noted.

8

Being told that you cannot pay for goods and services with cash is likely to cause embarrassment and frustration for some people, especially if there are practical reasons why digital payments may be difficult or impossible for them.

Noted.

9

Statistical data is limited on the number of organisations who do or do not accept cash payments in Jersey although the majority of organisations operating in the Island likely accept both cash and digital payment methods, there are some that only accept one or the other.

Noted.

10

Although there is no statutory definition of the term "legal tender", cash is given value as such through relevant elements of legislation. However, legally there is no requirement for a seller of goods or services in Jersey to accept a specific payment method, including cash as parties enjoy freedom of contract and choice.

This is correct.

11

Although security systems are employed to protect digital payment systems and their users, there is a perception among some individuals that digital payment methods are less secure than cash payments or open to criminal activity and it has been confirmed that large amounts of fraud

Criminal practices will always  evolve, and we have seen increasingly novel scamming and fraud schemes  in  recent  years.  The  States  of  Jersey Police,  Consumer  Council,  Fraud  Prevention Forum and Jersey Cyber Security Centre provide education and advice to affected Islanders.

Findings

Comments

occur electronically. To many, transacting in cash is seen as a protection against this. Conversely, the ability of cash to be stolen, lost or destroyed was also highlighted by both individuals and businesses.

Anyone affected by fraud should report this to the States of Jersey Police on 01534 612612.

This notwithstanding, it is recognised that money laundering activities are heavily reliant on cash and the use of cash is not a guarantee against fraud or scams.

12

The reliability of digital payment systems can be affected by a number of factors, including power outages, systems failures or cyber-attacks. There is a perception that cash offers resilience when digital payments are inoperable, however reliance upon technology to enable cash transaction or the supply of cash may cause issue in some circumstances. The impact and likelihood of digital payment methods being inoperable for extended periods has also been refuted by some.

Banks  are  required  to  maintain  business continuity  plans  subject  to  the  JFSC  Code  of Practice for Deposit-taking Business.

13

An individual's right to privacy was often highlighted as a key benefit of cash payments over digital payments. Banks having a duty to undertake due diligence with a requirement to understand the source of funds for all transactions, whether in cash or digitally and to undertake an assessment of risk. Individual's privacy when making digital payments are protected by the Data Protection (Jersey) Law 2018.

Noted.

14

Many people believe that cash gives them greater control of household budgeting and was a way to avoid getting into debt, which may be a higher risk when making digital payments.

The  Citizens Advice Bureau provides free and impartial  advice  to  Islanders  who  may  need support  in  budgeting,  this  includes  an  online budget planner.

A number of apps are also available to support budgeting while using digital payments.

15

Cash was perceived by many as easy and quick to use, however digital payment methods were perceived as easier and quicker to use especially by younger respondents to the Panel's

Noted, this is reflective of the importance that choice plays for both businesses and consumers.

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survey and witnesses who gave evidence.

16

Although the COVID-19 pandemic had a significant impact on payment methods, hygiene of cash is not understood to be of significant consequence to its use or acceptance at this time.

This is correct.

17

Overall, it was highlighted that digital payment methods provided significant productivity gains for businesses over accepting cash. Businesses face charges for use of digital payment systems such as card reader machines, which vary by provider and business size. Charges are also faced by businesses for bank services when handling cash, which has been highlighted as relatively more expensive than digital payments for some business account customers. Exact charges vary from bank to bank.

Noted.

18

There have been reported instances of organisations being asked to limit their cash transactions or refused banking services due to operating primarily through cash.

Noted.

19

The Government of Jersey does not have an agreed policy or strategy regarding acceptance of cash payments as an organisation or for cash use and acceptance within the larger economy.

Individual Departments maintain policies around the acceptance of cash and Government looks to support the use of cash payment where possible – with  explicit  provision  being  made  under  the Public Finances Manual.

Within the wider economy, individual businesses and  consumers  are  free  to  make  their  own decisions on their preferred payment method.

20

Money laundering regulations and guidelines include suspicious activity reporting requirements for both cash and digital payments, with additional requirements in place for high-value dealers. It is perceived that, in practice, suspicious activity, including cash payments, would be reported to

This is correct.

Findings

Comments

Financial Intelligence Unit and this had recently been exemplified.

21

Compliance work is undertaken by Revenue Jersey for both cash and digital payments. Jersey's National Risk Assessments have not uncovered any significant risks of domestic tax evasion, however it has been highlighted that HM Treasury has benefited by the rise in use of digital payment methods.

This is correct.

22

The Government of Jersey maintains a Currency Fund to match the value of Jersey's printed notes and coins to GBP Sterling. It has been suggested that this is a profitable venture for the Treasury as it is invested for a profit return.

Noted. The Fund is invested for capital protection

rather than for profit.

23

Acceptance of cash payments across the Government of Jersey is variable, with the Panel being informed of £1,000 limit and instances in which no cash payment could be made.

Individual Departments maintain policies around the acceptance of cash and Government looks to support the use of cash payment where possible. The Public Finances Manual provides alternative routes for payments greater than £1,000.

24

There is evidence that the demise of cash is having a detrimental impact to the economic inclusion of some vulnerable sections of the community. For many, cash acceptance was heavily linked to maintaining social connection, interaction and inclusivity. Physical cash was also seen by many as having value past its financial amount: being tangible, traditional and a novelty for tourists. Furthermore payment method acceptance may have wider impacts on certain elements of purchases, such as tips or service provision, as well as car-boot sales, honesty boxes and charitable donations.

Noted.

25

A number of European countries have introduced legislation mandating the acceptance of cash payments, including France, Germany, Norway

This is largely correct, although it should be noted that Estonia's legislation does not mandate the acceptance of cash payments.

Indeed, section 4 of the Payment Institutions and E-Money  Institutions  Act  cited  in  the  Panel's

Findings

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and Estonia. There are varied exemptions to mandatory cash payment acceptance that have been included by some countries legislating for this, including those based on set limit of cash value or number of coins or notes in one transaction.

report explicitly excludes payment transactions made exclusively in cash directly from the payer to  the  payee,  without  any  intermediary intervention'.

In January of this year, Estonia's National Bank introduced a new rounding rule for cash payments

– phasing out the use of one and two-cent coins in everyday shopping.

26

Having introduced regulatory protections concerning access to cash, acceptance of cash payments continues to be a topic of consideration in the UK, with a Parliamentary Select Committee Review of the topic underway.

The acceptance of cash payments continues to be a topical subject, but UK Ministers have recently ruled out forcing businesses to accept cash.

27

The European Commission made judgements and legislative proposals for the mandatory acceptance of Euro banknotes and coins, without extra charges for the person paying.

This is correct.

28

There is a strong desire from consumers to be able to choose their preferred payment method and non- acceptance of a payment method is perceived by many as a form of discrimination, However, it is not clear whether in fact, refusal to accept cash would constitute discrimination, in law, and has no challenges have been made or considered to date under relevant legislation such as the Discrimination (Jersey) Law 2013.

The issue of whether the refusal to accept cash constitutes  discrimination  under  the Discrimination  (Jersey)  Law  2013  is  complex. Based  on  current  understanding,  it  would  be challenging to prove that the refusal to accept cash directly  constitutes  discrimination,  particularly under  the  existing  legal  framework.  The  Law primarily addresses direct discrimination on the grounds  of  protected  characteristics,  including disability.  While  some  individuals  with disabilities may rely on cash for its accessibility, others may use digital banking methods, and there is no clear legal precedent or challenge to date in this area.

29

An organisation enjoys the right to accept payment methods of its choosing and there were those who indicated that leaders of the organisation or business should be allowed to continue to make decisions to best match their customer and operational needs.

Agreed.

Findings

Comments

30

There was a call by some to allow "market forces" to naturally run their course, and that consumer choice would dictate provision of payment method acceptance.

Noted.

31

Most organisations believe that mandating cash acceptance is unnecessary at this time and would introduce significant regulatory burden, and apart from one Jersey group (Cash is King) and one UK based group (Payment Choice Alliance) , those who gave " in- person" evidence stated they did not want to see legislation that required businesses to take cash, even those who advocated for vulnerable groups.

Noted.

32

There are calls for acceptance of cash payments to be safeguarded in Jersey, with some believing that acceptance of cash payments should be mandated through legislation. Those calling for legislative or safeguarding measures were generally of the opinion that these should be introduced for all cash payments, and there was a belief by some that essential services already met this need without further intervention. The view that all public service provisions should accept cash payments was also raised, and although this is largely the case, instances of refusal and uncertainty on amounts accepted have been identified.

Noted.

33

The Panel was made aware of instances of differential pricing based on payment method, this was often seen as unfair and discriminatory with calls made to prohibit this practice.

The   Price and  Charge Indicators  (Jersey) Law

2008 and  its  subordinate  Regulations  and  the Consumer Protection (Unfair Practices) (Jersey)

Law  2018 require  businesses  to  inform  their customers of any additional charge, including for a  specific  payment  method.  This  achieves transparency, however surcharges are lawful.

Businesses  may  include  such  charges  in recognition of the additional costs they incur as a result of transaction fees or costs to count and securely store a cash float.

Findings

Comments

34

It was suggested that anti-money laundering and client due diligence undertaken by banks to meet regulatory requirements could be contributing to the charges made for commercial banking services.

Noted.

35

The Minister for External Relations, with responsibility for Financial Services, undertakes conversations with banks about the services that they provide and the regulatory environment in which they operate.

This is correct.

36

Government-run banking services or central bank digital currencies were highlighted in the Review, but were not generally seen as realistic or beneficial in Jersey.

Noted.

37

There was a call from some members of the public to introduce banking hubs to deal with the issue of branch closures in outlying areas., with the Government of Jersey undertaking preliminary actions in this regard.

Noted.

38

Education on digital payment methods, building financial budgeting skills and support in accessing digital payments were identified as important to allowing appropriate economic inclusion, with private and charitable organisations providing this currently.

Noted.

Recommendations

To

Accept/ Reject

Comments

Target date of action/ completion

1

The Minister for External Relations should, by 31 December 2025, liaise with the banking sector to require that banks give 6 month notice period to both the

MER

Partially Accept

The Minister will be writing to members of the banking sector to request that they give  sufficient  notice  to  both  their customers  and  Government  of  any branch closures.

Q2 2025

Recommendations

To

Accept/ Reject

Comments

Target date of action/ completion

Government of Jersey and its customers prior to the closure of any of its branch or cash machines in the Island, and ensure due consideration is given to the needs of customers in the decision to close a bank branch.

2

The Minister for External Relations should consider other suitable and proportionate measures to ensure that minimum service levels are maintained by banks for their customers and the wider community in relation to in person counter and branch services and to the paying in and withdrawal of cash.

MER

Partially Accept

As above, the Minister will be writing to the banks to encourage them to ensure service  levels,  particularly  amongst outlying branches, are maintained and that where closures are necessary, these are clearly communicated to customers.

Q2 2025

3

The Minister for Sustainable Economic Development should, by 31 December 2025, ensure that relevant questions on the use and acceptance of payment methods are included annually within relevant surveys such as the Jersey Opinions and Lifestyle Survey (JOLS), Annual Business Survey (ABS) and Children and Young Persons Survey to allow for tracking of the topic. Data to enable policy consideration in this area should be routinely collated.

MSE D

Partially Accept

The  Minister  will  be  seeking  the inclusion of suitable questions within the next  Jersey  Opinions  and  Lifestyle Survey.

It  should  be  noted  that  the  Chief Statistician is independent and Ministers are not empowered to direct the Chief Statistician on the carrying out of their functions.

Q1 2027

Recommendations

To

Accept/ Reject

Comments

Target date of action/ completion

4

The Minister for Sustainable Economic Development should, by 31 December 2025, undertake work with Ministerial colleagues to ensure contingency planning is completed and there has been sufficient testing of the islands economic resilience should payment methods fail.

MSE D

Reject

This  recommendation  relates  to  the Minister  for  External  Relations  who holds  responsibility  for  Financial Services.

As  noted  in  response  to  Finding  12, contingency planning is already in place per the JFSC Codes of Practice which require regulated businesses to have in place business continuity plans to ensure they  can  continue  operating  and  limit losses to acceptable levels in the event of business disruptions.

Individual businesses are encouraged to maintain  their  own  contingency  plans should payment methods fail.

N/A

5

The Minister for External Relations should, by 30th April 2025, liaise with banks to ascertain the number of instances where businesses have been denied banking services and the reasons that some organisations may be requested to limit their cash handling. Results of these discussions should be provided to the Panel.

MER

Reject

Banks have valid reasons for rejecting new  businesses  or  implementing  risk mitigation measures to safeguard their operations.  There  is  no  evidence  of market failure in this area. Without a compelling justification for government intervention  in  collecting  sensitive information,  any  action  beyond  the existing measures enforced by the JFSC would be unwarranted.

However,  Government  continues  to liaise  with  industry  representatives  to identify and address any emerging issues in this area.

N/A

6

The Minister for Sustainable Economic Development should undertake work with Ministerial colleagues to form a clear policy and subsequent strategy on Government of Jersey actions regarding the acceptance of cash payments and digital inclusion. This should be

MSE D

Reject

This  is  not  considered  necessary  as Government  Policy  remains  that businesses should be free to choose their preferred payment methods.

As with other jurisdictions, we have seen a general trend in customer preference towards digital payments over the use of cash. Legislation is in place to ensure customers can make informed decisions and are advised of any additional costs associated with their preferred payment method.

N/A

Recommendations

To

Accept/ Reject

Comments

Target date of action/ completion

published no later than 31st December 2025.

6a

As part of the formation of an acceptance of cash payments strategy, the Minister for Sustainable Economic Development should give consideration and identify actions to negate the impact on the economic inclusion of all islanders should cash acceptance fall further or be removed completely, ensuring that no form of economic discrimination takes place.

MSE D

Partially accept

Government  remains  committed  to supporting  the  availability  of  cash  to enable  businesses  and  consumers  to make their own decisions around their preferred payment method.

The Minister for Sustainable Economic Development will continue to work with colleagues  to  monitor  the  availability and use of cash in Jersey and will take action if market failures are identified.

N/A

6b

As part of the formation of an acceptance of cash payments strategy, the Minister for Sustainable Economic Development should identify the implications of the actions undertaken by both the European Commission and United Kingdom in the acceptance of cash payments.

MSE D

Neither accept nor reject

This will be kept under review.

N/A

6c

As part of the formation of an acceptance of cash payments strategy, the Minister for Sustainable Economic Development should reflect on how to meet both the needs of consumers and business and consult with these sufficiently.

MSE D

Partially accept

The Minister for Sustainable Economic Development  meets  frequently  with consumer  groups,  such  as  the  Jersey Consumer  Council,  businesses  and industry bodies such as the Chamber of Commerce  and  will  ensure  that  cash payments  are  discussed  on  a  regular basis.

Ongoing

6d

As part of the formation of an acceptance of cash

MSE D

Reject

This  is  not  considered  necessary  as Government  Policy  remains  that

N/A

Recommendations

To

Accept/ Reject

Comments

Target date of action/ completion

payments strategy, the Minister for Sustainable Economic Development should give due consideration to development of legislation mandating for the acceptance of cash payments.

businesses should be free to choose their preferred payment methods.

6e

As part of the formation of an acceptance of cash payments strategy, the Minister for Sustainable Economic Development should identify actions to ensure the acceptance of cash payments by providers of essential services.

MSE D

Partially accept

This is not current Government Policy but  the  Minister  for  Sustainable Economic Development will continue to monitor the acceptance of cash across providers of essential services and will take  action  if  market  failures  are identified.

N/A

6f

As part of the formation of an acceptance of cash payments strategy, the Minister for Sustainable Economic Development should consider if prohibiting differential pricing based on payment method in the wider economy is needed.

MSE D

Reject

As outlined in response to Finding 33, businesses  typically  include  such charges  to  reflect  the  additional  costs they incur as a result of transaction fees or costs to count and securely store a cash float.

Prohibiting these charges could lead to these  businesses  refusing  to  accept payments in a more costly method or lead to the costs of these transactions being passed onto all customers.

N/A

7

There should be a presumption that cash payments are accepted for all public services, including parking and transport. The Council of Ministers, through any acceptance of cash payments strategy, should identify and confirm its position on the requirements, exemptions and limits to

CoM

Neither accept nor reject

This will be kept under review.

The  Government  aims  to  provide customers  who  are  unable  to  pay  via digital payment channels the option to pay for government services using cash. Payment options are kept under review.

N/A

Recommendations

To

Accept/ Reject

Comments

Target date of action/ completion

its own acceptance of cash payments in order to inform the wider Island economy.

8

As part of the formation of an acceptance of cash payments strategy, the Minister for External Relations and Minister for Sustainable Economic Development should consider how charitable organisations can be assisted by the both the Government of Jersey and the private sector including banks, during the transition to digital payments.

MER / MSE D

Accept

The Minister for External Relations will be writing to the Charity Commissioner to seek further clarification on this issue and understand what action, if any, could be taken.

Q2 2025

9

The Minister for Sustainable Economic Development should, by 30 April 2025, issue interim guidance to businesses indicating that they should accept a cash payment where it is the customer's only way of paying.

MSE D

Reject

This  is  not  considered  necessary  as Government  Policy  remains  that businesses should be free to choose their preferred payment methods.

N/A

10

The Council of Ministers, by 31 December 2025, should ensure that no differential pricing based on payment method is made in the provision of public services, including third party providers such as transport services and arm's length organisations.

CoM

Neither accept nor reject

This will be kept under review.

N/A

Recommendations

To

Accept/ Reject

Comments

Target date of action/ completion

11

The Minister for Sustainable Economic Development should, by 30 April 2025, issue interim guidance to businesses indicating that differential pricing based on payment method should not take place.

MSE D

Reject

See response to recommendation 6f.

N/A

12

As part of the formation of any acceptance of cash payments strategy, the Minister for External Relations should give due consideration to the impact of the banking regulatory environment upon payment options. This should include whether Ministerial oversight or limitation of banking charges on cash handling services is needed to ensure that charges are reasonable and proportionate.

MER

Reject

Without  a  compelling justification for Government  intervention,  mandating oversight  or  limitation  of  banking charges on cash handling services would be unwarranted. Statutory measures for redress already exist for consumers to pursue any concerns relating to fairness of  treatment  by  financial  service providers.

N/A

13

The Minister for External Relations should continue to work towards the provision of banking hubs, and report back to the Panel by 30th April 2025.

MER

Reject

This will be kept under review.

N/A