Which? the UK consumer watchdog, has issued its findings on the rate at which cash machines in the ATM network, are being closed down in the light of fee cuts from Banks to independent ATM operators. Their study found that cash machines are shutting down at a rate of 300 every month.
The rate of closures throws “serious doubt” on pledges by cash machine network Link to protect access in rural areas say Which? Changes to the way the ATM network is funded, will come into effect on July 1. The plan to reduce the fees paid by banks for each withdrawal is already making it more difficult for operators to survive, especially in rural and sparsely populated areas, say campaigners.
The Link network shut down almost 1500 machines from November last year up to April this year and Which? said it was a near six-fold increase from a steady rate of fewer than 50 closures a month since 2015.
Thousands of free cash machines could be at risk of being changed to charge fees or be removed altogether.
Which? has said the closures accelerated as operators began to learn of the plans from Link. It has called on the regulator to “urgently intervene” and halt the cuts until a “thorough analysis of the impact on communities is conducted”.
Money editor at Which? Harry Rose said, “With hundreds of cashpoints closing every month, we have serious concerns that, far from protecting consumers’ access to cash, Link’s plans risk destroying
“These cuts could see millions of people who rely on cash in their daily lives struggling through these closures – with severe consequences for many communities and businesses.”
“The impact of these cuts is already clear – with machines closing at a frightening pace.”
“The regulator must act now to stop further closures and ensure that consumers aren’t suddenly stripped of their access to cash.”
A spokesman for Link said, “Over the last 10 years cash payments have fallen by 33%. During the same period, free ATM numbers have grown 18,000 (50%).
“This disconnect is not sustainable and needs addressing now to protect Link and future access to cash for consumers.”
“Which? has suggested that ATMs have fallen by 1,500 in the period between November and April, however Link can confirm that during this period the number of free-to-use ATMs actually increased.”
“More importantly, coverage of free-to-use machines improved over this period as forecast by Link, with the net number of postcodes with free access across the UK increasing by five, including one in Scotland.”
UK Finance said earlier this month that debit card payments had overtaken cash as the most popular form of payment in the UK for the first time.
Consumers used their debit cards 13.2bn times last year, up 14% compared with 2016. The number of cash transactions fell by 15% to 13.1bn transactions in the same period.
However, there are some who remain suspicious about the banks’ motives. Some campaigners believe that the banks have an agenda to force consumers away from cash.
The head of policy and advocacy at the not-for-profit financial campaign group Positive Money, David Clarke, said: “More than two million people rely almost exclusively on cash every day. There is still massive demand for cash, with 77% of people seeing free access to cash as essential for their lives. It is only a minority of people who are going completely cashless.”
“This is all about the banks wanting to cut the fees they have to pay rather than anything else. Link has been forced into these cuts by the banks who are threatening to move to Visa and MasterCard schemes where the fees are even lower, but which would result in much deeper cuts to the free ATM network.”