Cash withdrawals from ATMs decline across UK

The volume of cash withdrawals from ATMs declined year-on-year across the UK’s nations and regions in early 2019, according to cash machine network Link.

The strongest declines were in London followed by parts of southern England and the weakest were in the north east of England followed by Northern Ireland.

In the first four months of 2019, there was a decline in Link cash withdrawals of 8.7% in London, 7.9% in the South East and 7.7% in the South West, compared with the same period in 2018.

London has seen a particularly large take-up of contactless card payments on public transport services in recent years.

In the North East, withdrawals fell by 3.7% and in Northern Ireland they decreased by 4.6%.

In Scotland, withdrawals were down by 5.4% and in Wales they fell by 5%.

John Howells, chief executive at Link, said: “These regional variations are important, and Link will ensure that areas which are not moving away from cash as quickly as others still have their cash access protected.

“What is clear is that the sharp drop in cash usage means that it is vital now to reform how cash is distributed to maintain broad, free access for all consumers.

“Link is determined to deliver this with the support of industry and regulators.”

There has also been a decline in balance inquiries made using ATMs in recent years, as many people now use banking apps to check how much money is in their accounts.

Balance inquiries have fallen by 18% from 2016 to 2019, Link said.

Total Link transactions for the first four months of 2019 were 8% lower than in the same period in 2018.

The declining rate of transactions appears to be accelerating and the reduction in Link transactions is currently expected to be between 9% and 10% for 2019 as a whole when compared with 2018.

But Link said the value of money being withdrawn is declining more slowly – perhaps because when people are using ATMs they are taking more money out as they may not visit them again for a while.

Concerns have been raised about the continued availability of free access to cash amid cash machine and bank branch closures.

A recent row over the funding of ATMs has fuelled the debate.

Link commissioned the independent Access to Cash Review, whose report in March made several recommendations for preserving cash access.

Recent figures from UK Finance show around 1.9 million people used cash for their day-to-day transactions in 2018, but 5.4 million people used cash rarely or not at all.

The number of cash payments peaked in 2000 when there were over 27 billion, accounting for 74% of all payments. By 2018, there were only 11 billion cash payments, 28% of the total.

Link’s report said that after previous large falls, this year has seen the number of pay-to-use ATMs start to increase – although numbers are still only at similar levels to a year ago.

The number of pay-to-use ATMs reached an all-time peak of 27,000 in 2007.

Ten years ago, there were 39,991 free-to-use machines and 23,111 charging machines.

In April 2019, there were 49,502 free-to-use machines and 13,147 charging machines.

Nearly three-quarters (73%) of free-to-use machines are within 300 metres of the next one, and 94% are within one kilometre, Link said.

Bank branch closures in recent years mean that by 2018 there were 7,700 branches – down from over 11,000 in 2013.

Link also said it must be expected that at some point the decline of cash usage will slow – leaving a “core” of cash users who will never give up cash or are only likely to do so over a much longer period.

This slowing in the fall in cash usage is expected to occur first in areas with currently high rates of cash decline, such as London, while other areas where the rate of decline is slower may “catch up”.

Here are the declines in Link cash withdrawals in the first four months of 2019 compared with a year earlier:

– East Midlands, minus 5.9%
– East of England, minus 6.4%
– London, minus 8.7%
– North East, minus 3.7%
– North West, minus 6.4%
– Northern Ireland, minus 4.6%
– Scotland, minus 5.4%
– South East, minus 7.9%
– South West, minus 7.7%
– Wales, minus 5.0%
– West Midlands, minus 6.0%
– Yorkshire and the Humber, minus 4.9%