Free cash machines are disappearing fastest in poorer areas

18 September 2019

One in 10 free cashpoints has closed or switched to fee-paying after major changes to how the network is funded

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Free cash machines are disappearing faster in poorer areas than they are in more affluent ones, according to a report.

Consumer group Which? says that those most reliant on cash and who can least afford to pay for withdrawals are facing charges or having to travel long distances to access their money for free.

Its analysis found that the most deprived areas across the UK saw a reduction of 979 free-to-use machines – equivalent to a 6% loss - in 2018.

This compares to just 223 free cashpoints – equivalent to 4% of their network of machines – in the least deprived areas.

The biggest losses were seen in poorer areas such as Birmingham Ladywood where 47 free machines have gone. This was followed by Bristol West (-40), Manchester Central (-36), Belfast South (-34), and Cardiff Central (-34).

Residents of Great Yarmouth have been left with a cashpoint network in which half of machines (49%) now charge a fee, with locals facing fees of up to £2.00 per transaction.

People living in towns and cities can lose cashpoints but still have reasonable access to free cash machines, but for those living in less-well served areas they are faced with no other option but to pay for withdrawals.

Data from LINK – the country’s largest ATM provider – shows that one in 10 free cashpoints has closed or switched to fee-paying after major changes to how the network is funded.

Which? chief executive Anabel Hoult and Natalie Ceeney, chair of the independent Access to Cash Review, have written to Chancellor Sajid Javid to implement a cash guarantee.

Jenny Ross, Which? money editor, says: “We know that people in more deprived communities tend to rely heavily on cash, so it’s deeply concerning that those who can least afford it are being hit with the extra burden of hefty fees to access their own money as free cashpoints close at an alarming rate.

“The government and regulators must urgently get a grip on these rapid changes to the cash landscape and guarantee people across the UK can continue to access this important payment method for as long as it is required.”

Protection for free machines

The news comes after LINK announced that funding would be made available to protect free cash machines.

John Howells, chief executive of LINK, says: "Which?’s report rightly points out that it is the less well-off and more remote parts of the country that are at growing risk of losing free cash access.” 

He notes that the number of fee-paying cash machines, whilst up from the end of last year, is still the same as it was at the start of 2018, and a lot less than the all-time high in 2007.

Mr Howells adds: "No consumer should be forced to use a charging machine to access their cash. Whilst there are still 47,802 free-to-use ATMs across the UK, we are beginning to work with communities to re-introduce free ATMs in areas with poor cash access. We are keen to hear from more and to make sure no one is left behind.”

A Payment Systems Regulator spokesperson says: “It is important that banks engage closely with local communities and their customers to understand their needs for cash so that well designed and suitably tailored solutions can be put in place to meet those needs.

“That includes solutions like LINK’s commitment to maintaining the geographic spread of free to use ATMs and other solutions like access to cash at Post Offices and in retail stores. We are looking at whether the structure of LINK fees for ATMs might play a part in this.”

ATM providers are cutting the number of machines they operate in response to declining demand that has made machines unprofitable to run.

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 of cards and electronic payments is increasing, cash is still a necessity for eight million people, the report says.

Comments

Keep Account Low

If you have to pay to get at your own cash empty all your excess cash from your account in one go and keep in a safe at home, just leave enough each month to cover direct debits, if you need to pay with a card use a credit card then pay off at end of each period. Don't let banks use your money for free and don't pay them fees.

Cash essential

I could not live without cash as I love to buy fruit and veg from local people who grow it and sell their excess to people in community, they only operate by cash, I get better, fresher produce at a fraction of price. If anyone helps me do a task I can no longer manage I give them cash for their help, if someone picks something up from the shop for you if you can't get out you need cash to pay them. Cash is essential to many people, we don't all use supermarket delivery as they are unreliable also often dump short dated fresh goods on your, rather choose my own.

Unreported cashless problems

Having witnessed the booming 1980's, I need to say that cash was one of the reasons for the economic growth of that decade. In the early 1980's, there was a massive contraction and the unemployed numbers quadrupled, but what saved the economy was cash for a great proportion of people who needed to work, but couldn't find stable, permanent jobs. From window cleaning to labouring, newly established market stalls and other businesses that grew from small beginnings, cash provided the fluidity that allowed the economy to recover from the closure of steel mills, factories, coal mines and more. The cashless society will stifle economic growth, particularly for the poorer people in society, and will only re-enforce social exclusion. The wealthy will benefit from reduced competition, while the socialist types will welcome less opportunity for people to enjoy a life free from the punitive taxes they wish to inflict. They consider our money as "theirs". So expect further poverty, (seemingly showing the need for social "control" of the economy, and the wealthy will naturally become more wealthy through a lack of competition. A perfect storm of political, and wealth corruption. And don't expect either party to even mention these realities.

Cash Machines

If they are starting to decrease the number of free cashpoints, why are they closing so many banks? To draw out your own money, you should be entitled to your own money, not forced to be paying extra to draw it out. Pop into a bank & you can draw the cash free, but who wants to be queing in a bank when they can just go to a cash point & draw the money & if they keep closing them people won't be liking it too much.

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