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Free ATMs becoming fee-charging at “unprecedented” rate

Nearly 1,700 cash machines started charging for withdrawals in the first three months of the year, according to consumer rights group Which?.

Figures from Link, the UK’s largest cash machine network, show that more than 1,250 free machines switched to charging a fee in March alone. The machines now charge users a minimum of 95p for accessing their cash.


In March, former financial ombudsman Natalie Ceeney published the Access to Cash Review, which warned the use of cash and coins is declining at such a rate it may not remain viable for as long as the public needs it.


The report warned that market forces could mean the use of digital payment methods could supersede cash to such an extent that it ceases to be widely accepted unless there is government intervention to preserve it.


Which? found that at the beginning of 2019, there were around 52,000 free-to-use machines in the UK.


There are concerns that further closures could follow, with two of the UK’s major cashpoint operators, Cardtronics and NoteMachine, revealing they have identified a further 5,000 free-to-use machines that could be switched to fee-charging in the coming months.


Both cited pressures, such as a cut in the fee operators receive from banks each time an ATM is used and the closures of bank branches across the UK as factors driving the switches.


Link, which oversees ATMs, began to cut the fee, known as the interchange rate, last year. So far it has reduced the charge from 25p to 23p per withdrawal.


Peter McNamara, chief executive of NoteMachine, said: "Unless urgent action is taken to reduce the pressure on ATM operators by reversing the interchange fee reductions, NoteMachine will be forced to begin converting ATMs to surcharging."


Gareth Shaw, head of money at Which?, warned that communities are being “stripped of free access to cash at an alarming rate” and that society’s most vulnerable would be hit hardest.


“A regulator is desperately needed to get a grip of these rapid changes across the cash landscape and ensure all those still reliant on this important payment method aren’t suddenly shut out from accessing the cash they need in their daily lives,” he added.


John Howells, chief executive of Link, said: “Free access to cash is vital for consumers and the UK enjoys extensive coverage that Link is committed to protecting. There are more than 50,000 free-to-use ATMs across the UK, 10,000 more than we had in 2009, and currently 12,700 pay-to-use cash machines, down from over 23,000 in 2009. Less than three percent of withdrawals at Link ATMs incur a fee. For now, there is no need for consumers to be concerned.


"However, we agree with Which? that regulatory support is needed as there is a risk to cash access in the long run. Cash use is in decline and, as consumers use alternatives such as contactless cards, we look forward to working with regulators to implement the recommendations of Natalie Ceeney’s Access to Cash Review.”

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