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More than 1,600 free cash machines start charging fees, Which? finds

Free cash machines are becoming rarer in the UK. Credit: PA

Britons are facing an increasing struggle to find access to free-to-use cash machines as nearly 1,700 terminals were changed into fee-paying machines between January and March this year, new research has revealed.

According to figures obtained by Which?, more than 1,250 ATMs were converted to fee-paying machines in March alone.

The consumer group said fees of at least 95p per withdrawal were imposed on 1,700 machines in the first three months of the year, with some fees reaching more than £1.99.

Which? described the rate of conversion as "staggering". Many of those converted into fee-paying terminals are operated by Cardtronics, the UK's biggest cashpoint provider.

But NoteMachine, another ATM provider which provides 7,000 machines in the UK, said it was weighing up plans to introduce fees at up to 4,000 of its terminals.

If those plans are given the go-ahead, Britain looks set to lose 13 per cent of its 52,000 free cash points in a few months.

Nearly 1,700 ATMs were converted to charge fees between January and March this year, Which? said. Credit: PA

ATM network Link, which oversees cash machines, said they have put in place specific arrangements to protect free-to-use ATMs more than a kilometre away from their next nearest free-to-use ATM.

Last year, Link began to cut the fee, known as the interchange rate, from 25p to 20p per withdrawal over the course of four years to help protect the future of ATMs.

A spokeswoman for Cardtronics said: “We have been forced into charging a fee for cash withdrawals on some of our machines where Link’s cuts have left us with no choice.

“The decision on whether to introduce a fee is taken on a case-by-case basis and reflects the economic viability of the individual machine.

“We only ever charge a fee when there is no other option apart from removing the machine altogether.”

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.

“This is a dilemma we have been grappling with for some time and are extremely reluctant to make such a decision.”

A recent Access to Cash Review chaired by former chief of the Financial Ombudsman Service Natalie Ceeney described the cash system as “on the verge of collapse”.

Communities are being stripped of free access to cash at an alarming rate that could hit the most vulnerable in our society

– Gareth Shaw, Which? magazine

Gareth Shaw, head of money at Which?, said: “Communities are being stripped of free access to cash at an alarming rate that could hit the most vulnerable in our society the hardest, while denying millions of people free withdrawals.

“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.”

Last year, Link began to cut the fee, known as the interchange rate, from 25p to 20p per withdrawal over the course of four years to help protect the future of ATMs. Credit: PA

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 3 per cent of withdrawals at Link ATMs incur a fee.

He added: "However, we agree with Which? that regulatory support is needed as there is a risk to cash access in the long run.”

Federation of Small Businesses (FSB) national chairman Mike Cherry said: “Charging shoppers to withdraw their own money is wrong and dampens consumer appetite, causing a drag on local growth in the process.”

A spokesman for the Payment Systems Regulator (PSR) said: “We are aware that some ATMs have changed from free-to-use ATMs to pay-to-use.

“We are looking into this and if it impacts on the commitment Link has made to us to protect the broad geographic spread of free-to-use ATMs we will take action.”