/ Money

Getting rid of cashpoints is ripping apart communities: is yours affected? 

closed cashpoint

Thousands of free-to-use cashpoints are at risk of closure, which could have a real impact in rural communities, where residents rely on them to access their cash. At an event in Parliament this week, we once again urged the regulator to step in…

For millions of us living in small towns and villages across the country, life often revolves around a series of barely noticed but essential daily rituals.

The daily stroll to buy a newspaper and perhaps a pint of milk, stopping for a chat with the shopkeeper who you’ve known for years.

There might be a chance encounter with a friend on the high street and time for a cup of tea before hopping on a bus to visit a friend or relative across town.

Perhaps you take your child to a mother and baby group, sing in the choir or are a member of the bridge club – and in the evening enjoy a meal in a local pub or restaurant before taking a taxi home.

These small interactions and activities are the glue that holds our communities together – and all rely heavily on people having easy access to cash to pay for these goods and services locally.

Access denied

But many communities could soon see their access to cash cut off – with free-to-use cashpoints threatened with closure by changes to the way the network is funded.

Link – the UK’s largest cash machine network – has announced a 20% reduction in the fees banks pay machine operators when their customers withdraw cash.

Such reductions will make some cashpoints no longer financially viable to run, leading to machines being removed in their thousands.

These changes have been led by pressures from some banks keen to cut their costs and have been waved through without any consideration for the very real impact they would have on communities.

Our campaign

That’s why Which? has teamed up with the Federation of Small Businesses to call on the Payment System Regulator (PSR) to urgently intervene and ensure that people won’t be stripped of their preferred and relied-upon method of payment.

Many people and small businesses are already reeling from bank branch closures – over 2,000 in the past three years alone.

The removal of free-to-use cashpoints would be a further blow, leaving many people facing an uphill struggle simply to pay for the goods and services they depend upon.

We know that over 2.7 million people are almost entirely reliant on cash. And we know, from the countless stories we’ve heard since our campaign launch, that for many people, there is much more at stake than convenience.

We heard from Sue, who lives in a rural Welsh community that’s already been hit with bank closures.

She needs cash to pay the milkman, top up electricity and pay the food delivery scheme of which she’s a member.

Her ability to carry out all these essential daily tasks is suddenly thrown into real doubt by potential cashpoint closures.

Cashpoint deserts

Recently, we found more than 200 mostly rural communities to be under-resourced in terms of access to a free-to-use cashpoint – with just one machine, or none at all.

Cardtronics – the UK’s largest operator of machines – has already warned that these changes will have the greatest impact in these areas.

This campaign is not about trying to halt the march of progress. There is scope to reduce the number of cashpoints side-by-side in cities and large towns as other forms of payment reduce the use of cash by many people.

We recognise that technological advances have brought new ways to pay that have enriched people’s daily lives. But we also recognise the needs of all those who do rely on free cash to go about their business. So the PSR must explore all the options available to guarantee convenient access to free withdrawals across the UK.

That’s why, at an event in Parliament on 26 February, we called on the PSR to intervene and ensure people like Sue, and all those people and communities that rely on accessing cash, can continue to do so.

This is an adapted version of an article by Peter Vicary-Smith, which was originally published in The Telegraph.

Do you think the PSR should be doing more to protect access to free-to-use cashpoints? Is your community being affected by cashpoint closures?

Comments
Mark Elder says:
16 June 2018

I’m not concerned about bank branches as I can’t remember when I last used one, but I am concerned about lack of cash machines. These are increasingly provided by local Co-ops – which is fine as long as it happens. Banks should have a legal responsibility to ensure there is 1 free cash machine in each community (at postoffice is fine, but the banks should cover cost so it is free to use). There is only one cash machine in my large village (pop 2500) but it charges £2 a go!

In Crediton, Devon, we only have Lloyds bank left. I was with Barclays and now have a half hour bus journey plus a 10 minute walk. Being an octogenarian I can no longer do that walk. I do telephone banking and can get money from our village post office. I used to enjoy going into the bank which I have used for 30 years to discuss face to face money matters. They knew me as a person. There is a post office in Crediton also. Thank God for the post office.

Colin says:
16 June 2018

cashless society is a much more serious problem than lack of cashpoints, banks are planning to steal your money, money in the bank is no longer safe from who, the bank.

Since the closure of many pits in the area where I live, this has been a problem.
It is particularly difficult in villages, that are often left with no shops, post office or bank. As these are often isolated communities with a limited bus service and people often unable to afford their own transport, which clearly compounds their sense of isolation and left almost as “backwaters”.
Desperate for all concerned, compounded by disability and older age.

Ann says:
18 June 2018

Unfortunately all the banks in Emsworth have now closed, which is a shame as it is a busy, thriving community and there are several thousand new homes being built in the vicinity. Fortunately we can obtain cash from the Post Offices which are situated in local Co-op stores, but it does make life very difficult when it comes to putting cheques into our account.

It is so easy to post cheques to your bank branch I don’t know why people prefer to make a journey to a bank in order to pay them in over the counter. In all the years I have done it, nothing has ever gone wrong.

According to the Post Office website you can deposit cheques into almost all of the banks using your bank’s paying-in slip and a paying-in envelope. https://www.postoffice.co.uk/branch-banking-services

Dimelda says:
29 June 2018

You say it’s easy to post cheques – and it is – but, if one is regularly paying in cheques, postage can quickly add up to a tidy sum. That’s why people prefer to pay in cheques in person at a bank – with no postage costs!

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Then you can use the post office, if there is one. Paying in person is not free either if you have to travel to a bank branch; many people will need to drive, or take a bus, to get there.

Most current accounts are “free” and we have grown to expect to be served by our banks without paying them – direct debits, cash withdrawals, cheques, bank transfers, providing statements…. For many who keep little on deposit, the bank earns nothing in return. It may be that we should start to pay for our accounts, and in return have the banks pay a commercial rate of interest on any money we deposit with them, and charge sensible rates only for overdrafts. However, remember then that the ATM interchange fee, for example, of 25p would be charged to your account, the real cost of handling cheques would be passed on, and costs associated with standing orders, direct debits, money transfers would appear as a direct charge.

Press release: Which? responds to UK Finance announcement that debit card payments overtook cash last year 18 June 2018

Gareth Shaw, Which? Money Expert, said:

“Clearly the way we shop and pay for services is changing but for millions of people in the UK cash still plays an essential role in their everyday lives.

“With bank branch closures on the rise and the UK’s free-to-use ATM network under threat, it’s vital these people are still able to access the cash they need.”

Questions no one has chosen to answer are, for example:
– what size community should be entitled to a free-to-use ATM
– how far (minimum distance) from anyone / any community / and what size community should we like an ATM be required to be sited.

I maintain that if accessing cash is the discussion point, we should look at what other places could provide it, and whether we should be entitled to access cash 24 hours a day.

Simpy focusing on the loss of ATMs (and we do not yet know what the LINK proposals will achieve, do we?) is, in my view, an inadequate approach. Pragmatism needs to be used.

In all of the discussion about bank branch closures and the inconvenience it has caused, we seem to have overlooked that for many working people the branches were never convenient – closing at 3:30 and not open weekends in the main was hardly useful to someone who wanted to bank if they worked 5 days a week. Online banking, transferring banking services to the post office, would be regarded as an improved service to whatever had previously existed..

We bank with Barclays in the town of Nailsea. We use the bank physically very little but when we do it is v. important need.
Cashpoints are a must. Even in an increasingly cashless society you do need to have money on your person. What happens if cashpoints disappear or become user unfriendly. Money under the mattress!!

Most large supermarkets still provide cashback up to £50, and most people visit one at least once a week. They usually also have ATM’s outside and don’t seem to be closing them. Where there’s food there’s money.

Those who can get to large supermarkets are unlikely to have a problem. What about those in villages and dependent on online supermarkets. I don’t think Ocado will deliver cash.

I expect supermarkets to supply their customers with groceries and banks to provide their customers with ATMs.

Yes – but it’s partly because the supermarkets have gone into the banking business and set up their own cash machines that the banks are withdrawing theirs since they now get less and less use. The Link proposals should deal with the distribution of ATMs but they might not all be free and there could still be deserts. The closure of cash machines in villages will have serious consequences and people will probably have to restructure their lives. If any member of the household goes out of the village to work they might have to obtain cash for others. If people visit their nearest large town they might need to get more cash than previously in order to tide them over until their next visit. They might have to do more shopping on-line or with cards in order to eke out their limited cash reserves. I sometimes wonder how much longer supermarket deliveries can continue before the charges become a deterrent. I had a Sainsbury delivery yesterday for £1 because I was able to choose a slack period on a Monday, but many people cannot be in at such a time to take in a delivery and could end up paying up to £7 for a Sunday slot – that could be 10% of the order value.

The big problem with the removal of cash machines is that it is not just a retrogressive step to the previous position; the status quo no longer exists, as the banks have closed their village and small town branches. They are now in the process of closing their branches in medium-sized towns with not only a town population of 25,000 but a hinterland population in the surrounding villages of half as much again. I can’t understand how we didn’t see this coming. It’s probably gone too far now for anyone to halt it other than the proposals by Link – but they are not set in stone and will only last so long as it is commercially viable.

I cannot see this government intervening in the freedom of the market and requiring banks and building societies to provide free-standing and fee-free cash machines in all settlements above, say, 1,000 adults. Even roadside filling stations that often have an ATM are becoming fewer and further apart in rural areas and diverting off a main road to go into a town for cash causes delays and parking problems and possible extra expense.

We have heard absolutely nothing from the banks or the industry spokespeople on this controversial topic but I suppose that is par for the course; it would not surprise me if Which? had not even asked them for a comment.

The Link document is years too late and fails to acknowledge the number of ATMs that have been removed in rural areas, often as a result of branch closures.

I can understand branch closures though this could have been mitigated by shared branches. I used one for around fifteen years but this cooperation was an initiative of the university I worked at. It might still have existed if the building had not been needed to accommodate expansion of a faculty. Some communities are served by mobile banking services. I regularly visit a village where there is a weekly Post Office service in the village hall on Mondays and Thursdays for two an a half hours.

Providing ATMs must be economically viable but that does not mean that every ATM must achieve this. The same applies with other services such as buses in rural areas.

It will be interesting to see how online supermarkets fare in coming years. In rural areas perhaps it would be more efficient if one company handled deliveries on behalf of two or more supermarkets. The Link scheme was perhaps one of the best examples of cooperation between companies, and now it’s all going pear-shaped.

This cionvo has, understandably, had a surfeit of complaints about the loss of ATMs, bank branches and so on. However these are run by commercial organisations and the majority of customers have contributed to their reduction by a change in habits.

What I would like to see is recognition that times have changed and constructive proposals as to how we best deal with it in future. Avoided questions have been just how small a community needs to be to justify a free ATM, and how far should any one have to travel to get to an ATM. Clearly they cannot be on everyone’s doorstep.

Another point that has been made is one of personal organisation. The vast majority of people will be able to get to a source of cash but it may involve a journey, and that may be coincident with a routine visit to a town, supermarket for example. Then draw out enough cash to cover your needs until the next visit.

As with so many issues, it seems to me that the vast majority of the population are catered for, even if some will have to be inconvenienced. The real problem I’d suggest we need to concentrate on are those who need cash but are not unable to get to a source due to disability say, lack of transport or other such impediment. How do we deal with these unfortunate people?

And, of course, these people are not just faced with a problem getting cash; they’ll no doubt face problems getting shopping, visiting the doctors, going to a post box for example. Something I can only see best dealt with by the local community if no close family is available.

A surfeit of complaints suggests that there have been too many, which is a bit of an insult to those who have commented on how their lives have been affected by removal of ATMs. Hopefully their comments will help Which? with its campaign.

It is no “bit of an insult”, but a statement. Many people would, no doubt, still have had such problems even when we had more bank branches and ATMs simply because of where they lived and/or their personal health.

I am more concerned with how we deal with the current situation and that requires some thought. I’d like to see convos like this encourage constructive remedies and people’s practical experiences that could be changed so that there might be a useful outcome. Particularly for those who really have no easy means to access cash because of their condition.

Just like we have lost convenient corner shops because of supermarkets, high street shops because of online shopping, and bank branches because they have been deserted by many customers, we need to find ways of coping with change.

Have a look at the posts by Danni’s, further up this page:

“Since the closure of many pits in the area where I live, this has been a problem.
It is particularly difficult in villages, that are often left with no shops, post office or bank. As these are often isolated communities with a limited bus service and people often unable to afford their own transport, which clearly compounds their sense of isolation and left almost as “backwaters”.
Desperate for all concerned, compounded by disability and older age.”

I challenge you to provide a helpful response to this comment. I would like to see a Which? super-complaint about the way the banks are collectively treating some of their customers. In my view, what is needed is coordination of local services in rural areas.

I have asked for constructive proposals as to how the situation can be best addressed. I would rather encourage posts on possible ways to tackle the situation. I have, with others, made some in previous comments. Do others have suggestions?

It looks as though we cannot halt the Bank closures so the Mobile Bank Vans have to be a great deal more user friendly. They need to be larger inside, proper sturdy safe steps for getting in and out, sufficient room for privacy, weather protection for waiting clients. They need a proper upgrade; up here in Northern Scotland where weather, daylight hours etc require substantial improvements on the present vehicles. Parking arrangements need to be pre-arranged so that the customers know exactly where and when the unit is. We are fortunate to have friendly helpful staff but the flimsy poor standard vans don’t encourage them .

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Other than the various banks, there is another countrywide organisation, very well-run, that has cash counters in every town and tiny village, viz. the Post Office. Surely the PO can take over cash transactions on behalf of banks, even take deposits of cheques as the PO has a fantastic mobile collection and delivery system.
All it takes is a small addition made to their computer systems to make this all come true for many villages and towns. The banks can close all their branches and pay a small transaction fee to the PO for each and every transaction, be it drawing cash or paying in cheques or cash.
In the larger centres obviously bank cashpoints (ATMs) will remain. However, being able to close huge numbers of their ATMs in small places, banks can afford to keep open those in larger centres.

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Harry, the banks made an agreement with the Post Office to provide essential services over the counter for their customers. This includes, in most cases, cash withdrawals and the paying in of cheques. P.O.s often have more convenient opening hours than bank branches ever offered.
https://www.postoffice.co.uk/branch-banking-services

Our local Clydesdale bank closed. As we did not wish to have our business account in the same bank as our personal accounts, we tried to open one with the RBS. Our local branch no longer has a business manager in branch. It is now a year on we are still waiting. We now have a 22mile round trip, to access a branch. That is a morning wasted. Now we have the delight of the Clydesdale being taken over by Mr Branson, we wait with baited breath to find out what will happen next.

The government should charge a levy on each of the banks and use this to fund the ATMs throughout the UK. The levy should reflect the full cost of maintaining the system.

The banks already pay a levy – 25p a transaction – to maintain a network of free to use ATMs. LINK administer this. This is effectively paid for by all the banks’ customers, indirectly.

Bank closures, cash point closure or access – are people of the United Kingdom being led to a cash-less society? It would seem to me this is the trend ! Some airlines are already cashless , they will not accept or give cash compensation ! I think it only a matter of time before every corner of financial life operates in the same manner as airlines!

colin says:
29 June 2018

I am one that doesn’t carry a lot of cash with me but the cash machines are so useful when you need money in an emergency ie bank holidays and Christmas as an example I fully understand that technology is taking over but when you are like myself and my wife we are a lot older and the government is not taking this in to consideration

i LIVE IN A SMALL MARKET TOWN AND AT PRESENT WE HAVE 3 CASHPOINTS. HOWEVER, WE DO NO LONGER HAVE A BANK AND HAVE TO TRAVEL SOME DISTANCE TO GET TO ONE. I AM UNABLE TO WALK BUT A FEW YARDS AND COULD NOT GET TO A BANK. I RELY ON ONLINE BANKING AND MY NEAREST CASHPOINT WHICH LUCKILY IS ONLY LESS THAN 100 YARDS AWAY, WE WERE WITHOUT THAT AT ONE STAGE WHEN THIEVES SMASHED INTO THE CO-OP AND TOOK THE SAFE AND EVERYONE FOUND IT VERY HARD, LUCKILY THEY REPLACED IT AFTER QUITE A LONG PERIOD SO TO BE WITHOUT IT WOULD BE VERY HARD GOING FOR A LOT OF PEOPLE. WHAT IS OUR WORLD COMING TO, A LOT OF IT IS GREED, THOSE THAT MAKE THESE DECISIONS WANT TO HAVE THEIR LOCAL AMENITIES TAKEN AWAY AND THEN SEE HOW THEY MANAGE?

Today I an asked by Which? again to sign their latest petition against ATM closures.
….Cashpoint closures accelerated as operators heard plans from LINK – which runs the UK’s largest cash machine network – to cut the amount that banks pay for withdrawals.

If these cuts go ahead next week many communities will be left struggling to access cash. The regulator must urgently intervene and stop these changes until we know how it will impact our communities.

If a 1p reduction in the LINK payment is critical, then I for one would be more than happy to pay a 1p charge for a cash withdrawal if it kept an ATM open. Even 5p in 4 years time.

ATMs are a commercial operation and I don’t see how we should expect a public intervention unless that is accompanied by a public subsidy; no more than we should subsidise banks to keep branches open (and as far as I know we don’t),

If ATMs are regarded as a social amenity then I think back to an earlier comment pointing out their local authority extracts over £1000 a year from the owner in business rates. If that report is correct then maybe this is an area to attack.

However, what these Which? pieces never seem to do is more than make a single minded attack. They do not look at the alternatives. A post office will provide cash to people with bank cards. Supermarkets provide cash back. All these shops where people want to use cash will also be holding cash; so why not encourage them to dispense cash to people with bank cards? A planned visit to a bank or ATM while doing other shopping could provide the cash you need until the next time.

And other questions that are never answered are
– what is the smallest size community that should be “entitled” to have an ATM
– how far apart should ATMs be? Or, put another way, just how far should any individual have to travel to access an ATM?

I do wish that Which? would look at such topics in the round, provide helpful advice as well as being critical, and take a more constructive view. It may not make such good headlines, but exploring methods of dealing with the changes brought about by changing consumer habits – a prime cause of this current problem – wold be a good deal more useful (just my opinion, of course).

Helen Grogan says:
29 June 2018

I rarely use cash but on a trip to London last weekend thought I might need some and was horrified that the cash machines in the motorway services were charging £1.99 per transaction. If you are withdrawing £250 the % is ok but £50 or less it is daylight robbery.

These are machines paid for by the host, not by banks, and make them money. Only 3% of ATMs are currently charge ones, so best to use one of the other 97%.

At the moment the question is that a reduction of 1p (rising to 5p in 4 years) in the 25p fee that your bank pays when you withdraw cash from a free-to-use (to the customer) will lead to a gross reduction in their availability. If this is true, how many people would be prepared to pay 1p (5p in 4 years) per withdrawal if that protected these at-risk ATMs?

Two bank branches have closed in recent years, leaving only the Nationwide, which has no cashpoint.
Cashpoints remain outside 3 x Tesco stores, Morrisons & a garage. Cash is not usually a problem, but face-to-face banking is. It’s a five or six mile drive to the nearest branch of my bank.
I have used the post office for paying in the occasional cheque, but they don’t process them on site – it’s just a forwarding service – so there is a day’s delay in crediting them.

There is, for some reason, a new Convo on this topic. Why we need two running in parallel, with comments split between both, seems odd. Many useful inputs made in the past here will be lost, and we’ll just start all over again.
https://conversation.which.co.uk/money/atm-cuts-free-cash-machines-interchange/