The move towards contactless could leave millions without access to cash if ATM providers close machines
The volume of cash withdrawals from ATMs is falling as more people go contactless for their day-to-day shopping, according to new data from cash machine service Link.
In the first four months of 2019 there was a decline in LINK cash withdrawals of -8.7% in London, followed by the South East (-7.9%) and South West (-7.7%) at link ATMs.
London in particular has seen a large growth in the use of contactless, especially on public transport in recent years.
The smallest decline was in the North East (-3.7%), then Northern Ireland (-4.6%) and Yorkshire (4.9%).
The uptake of new payment methods such as contactless is reducing the demand for cash and ATM withdrawals.
ATM providers are cutting the number of machines they operate, in response to declining demand that has made machines unprofitable to run.
A recent report by UK Finance predicts a fall in cash usage from 28% of consumer payments in 2018 to only 9% by 2028.
Ten years ago, there were 39,991 free-to-use machines and 23,111 charging machines. In April 2019, there were 49,502 free-to-use machines and 13,147 charging machines.
Link says there has also been a decline in balance enquiries in recent years as more people check their cash online and mobile banking. Balance enquiries have fallen by 18% from 2016 to 2019.
John Howells, chief executive at LINK, comments: “These regional variations are important, and LINK will ensure that areas which are not moving away from cash as quickly as others still have their cash access protected.
“What is clear is that the sharp drop in cash usage means that it is vital now to reform how cash is distributed to maintain broad, free access for all consumers. LINK is determined to deliver this with the support of industry and regulators.”
Millions could struggle
There are growing concerns that the move towards a cashless society too quickly could leave millions struggling.
If falling demand for cash leads to ATMs being closed, there is a risk of some people losing access to the services they need.
Link’s Access to Cash Review published earlier this year warns that Britain’s cash infrastructure is in danger of collapsing.
It says the elderly and disabled could lose their independence, rural communities could be threatened and debt could also increase.
There are fears the country could be a cashless society within the next 15 years if the current declining usage trends continue.
Even though the use cards and electronic payments is increasing, cash is still a necessity for eight million people, the report says.
Contactless can cause debt
Contactless cards can cause those bad at budgeting to eb=nd up in debt, I have seen it first hand, it's too easy for some people to just tap the card and not know what they have spent. Just as bad as credit cards for those with bad credit history. Should go back to days before credit and debit cards and where you had to pay a third deposit on items you bought on the never never.