Regulator’s intervention on ATM closures may be "too little, too late"

12 September 2018

The Treasury Committee Chair, Rt Hon Nicky Morgan MP, warns as new figures show one protected ATM closes every other day.

LINK is the operator of the UK’s cash machine network. Earlier this year, it announced a 20 per cent reduction over four years in its interchange fee – the fee paid by card issuers (banks and building societies) to ATM operators, which funds the network.

The first reduction in the fee (five per cent) came into effect on 1 July 2018.

LINK has today published figures showing that 76 out of 2,365 protected free-to-use ATMS closed between 1 February 2018 and 1 July 2018. A protected ATM is one that is more than 1km from any other ATM.

The Payment Systems Regulator (PSR) has announced that it will take regulatory action by requiring LINK to set out more explicitly how it will maintain the broad geographic spread of free-to-use ATMs across the UK.

Commenting on the announcements, Rt Hon. Nicky Morgan MP, Chair of the Treasury Committee, said:

"When LINK launched its consultation on the future level of its interchange fee last year, I warned that it was difficult to see how it could guarantee the reach of free-to-use ATMs.

Today’s figures show that, even before the interchange fee changes took effect, one protected ATM closed every other day. These protected ATMs will represent the only feasible means of accessing cash for many people, so this is a worrying trend.

The PSR is rightly concerned by the closures, but I fear its regulatory intervention may be too little, too late. It must ensure that LINK is held to its commitment to maintain the broad geographic spread of free-to-use ATMs.

The Committee has been clear that this is a major test of what is a relatively new regulator, but the banks, the ATM deployers, and LINK itself also have a duty to ensure consumers don’t lose out."

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