LINK Consumer Committee Report: LINK Banks and Cash Machine Operators Deliver on Free-to-use Cash Machines

31 July 2008

The LINK Consumer Committee’s second annual report, published today, welcomes the achievements of the banks, building societies and ATM operators of the LINK cash machine network in deploying new free-to-use ATMs in lower-income areas of the UK, and enhancing the clarity of signage on pay-to-use cash machines.

Around 2,000 new free-to-use cash machines were installed in 2007, and over 400 have been located in target lower-income communities that previously had no free-to-use ATM. This has brought local free-of-charge access to cash to around 1 million people in these communities.

Ken Andrew, Consumer Committee Chairman, said: “This has been a good year for the LINK cash machine network. The number of free-to-use cash machines has increased significantly over the year, with many of these new free-to-use ATMs placed in the small proportion of target lower income areas which previously did not have a free machine. The number of pay-to-use cash machines also grew slightly, helping to bring convenient cash access to locations where it would not be economically viable to run a free cash machine.”

The Consumer Committee’s report shows, however, that success in some areas of the UK – such as major cities in Scotland, the North East and Wales – has not been matched in other areas such as Birmingham, Liverpool and Manchester. ATM operators and the Consumer Committee have concerns that a negative attitude towards ATM planning permission applications, in particular fears that cash machines might generate crime, has been a factor in the varied results. If the same success had been achieved in Birmingham as in Newcastle, another 50,000 residents of Birmingham would have a new free-to-use cash machine. As reports by Parliament’s Treasury Committee and on financial inclusion have noted, local access to cash plays an important role in sustaining and enhancing the economic vibrancy of a community. The Consumer Committee calls on government – and in particular the Department for Communities and Local Government and the Home Office to help ensure that the “joined-up approach” sought by the 2006 Working Group chaired by John McFall MP is achieved through-out the UK by local authorities and police forces who can work with ATM operators to maintain and extend safe and secure access to cash.

The Consumer Committee also welcomed the improvements made to the clarity of signs for customers at pay-to-use cash machines, with all pay-to-use ATM operators completing programmes to apply new larger-font on-screen messages to 15,000 cash machines. Prior to finalising the new rules on cash machine signage, there had been extensive consultation and agreement with consumer groups on what the new signs should look like. Lessons learnt from the best pay-to-use ATM operators have been applied across all pay-to-use cash machines. There is encouraging evidence that the objective of clarity has been achieved. LINK has not received a single complaint about lack of transparency of signage at any cash machine that has been brought into line with the new rules. The government has also welcomed the work on signage, and the clarity for consumers of when a charge is applied for withdrawing cash. The Committee was, however, disappointed that a couple of pay-to-use ATM operators missed the target date for completing their enhancement programmes by some months.

The Consumer Committee also considered a number of other aspects of work by the LINK ATM network, including the introduction of foreign-currency dispensing cash machines in the UK (with over 200 of these now deployed), and measures to reduce the risk of fraud at UK cash machines.

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