According to consumer body Which?, some 5,828 branches have closed since 2015 at the rate of 54 a month. Lawmakers expressed concerns about "shameless" closures, which can leave the vulnerable and less well off exposed, especially in rural areas.

The Financial Conduct Authority told lawmakers it has been consulting on new powers to require banks to publish an assessment for justifying any branch closure, and spell out what workable alternative source of cash would be put in place.

A survey for the FCA showed that only 6% of the population solely or largely use cash for payments, as most people use cards and bank online, it said.

David Geale, FCA director of retail banking, told parliament's Treasury sub-committee on financial services that the watchdog would have the new powers in the third quarter.

"It's not all about bank branches," Geale cautioned, adding the FCA could not stop a branch closure, only "direct" banks to have an alternative source of cash in place.

This could be a nearby Post Office, free-to-use cash machine, or hubs backed by several banks.

However, only 30 of a planned 100 hubs have been rolled out. Geale said this figure would rise to 50 by Easter after he had complained about the slow pace.

"We regulate the banks. We expect the banks to deliver," he said.

The Bank of England and the finance ministry said last week they would continue preparatory work for a potential digital version of the pound. The FCA's new powers seek to reassure the public that any digital pound, still some years away, would not totally supplant cash.

"Around the end of the decade doesn't feel impossible," Nick McLaren, the Bank of England's future of money division head, told the lawmakers.

(Reporting by Huw Jones; Editing by Kirsten Donovan)

By Huw Jones