Britain's banking industry has agreed to subsidise the cost of installing more than 600 free cash machines in lower-income areas around the country. The initiative, announced today by a parliamentary working group on cash machines, is designed to address mounting concern about the rising number of ATMs that charge users for withdrawals.
While more than 30,000 cash machines operated by banks and building societies around the UK make no charge when customers withdraw cash, independent operators have installed 25,000 ATMs that do levy a fee, typically £1.50 per withdrawal but sometimes significantly more.
Consumer groups have accused leading banks of withdrawing cash machines from socially disadvantaged areas, leaving low-income residents with no choice but to use fee-charging machines. In some cases, banks have even sold many of their cash machines to fee-charging operators.
Under a deal announced today, however, any cash machine operator that installs a free machine in one of just over 600 locations identified by the parliamentary working group will be entitled to receive subsidies from other members of the Link cash machine network, which includes all free and fee-charging ATM operators.
Royal Bank of Scotland has already agreed to provide 300 of the machines, while HSBC and the Halifax Bank of Scotland group will provide a further 100 ATMs each. Bank of Ireland and BankMachine, an independent operator, will also install new free ATMs under the scheme.
John McFall, the chairman of the Treasury Select Committee, who also chaired the working group, said: "This is a huge step forward in our campaign for financial inclusion," he said. "It will mean a huge expansion in access to free cash machines for people in low-income areas, vital for economic activity in those areas."
Citizen's Advice also welcomed the initiative, which is expected to cost Link members up to £30m over the next 12 months.
Today's agreement also included recommendations for new standards on how ATMs that charge customers should make it clear that fees are payable.