Which? seeks 'urgent review' of proposals for UK's free-to-use ATM network

An urgent review of the free-to-use ATM network is needed to make sure people are not left struggling to access cash, according to consumer campaigners.

Consumer group Which? said it is concerned that a row over the funding of the network could lead to widespread closures of cash machines.

It has written to the Payment Systems Regulator (PSR), asking it to step in and conduct an urgent market review.

The PSR should fully evaluate the potential impact on consumers - millions of whom rely on the free-to-use network of ATMs to access cash - it said.

Meanwhile, the PSR has said it is monitoring the situation closely - and it will take regulatory action as necessary if it considers that any decision made by the UK's ATM network Link is not in the interests of consumers.

Which? said the concerns about the future of free-to-use ATM access come alongside bank branch closures - raising issues around consumers' ability to have easy access to their money free of charge.

The consumer group said that last year 2.7 million people in the UK were reliant almost entirely on cash.

The call by Which? follows a consultation recently launched by Link, into the interchange fees paid by card issuers such as banks and building societies to ATM operators. The interchange fee funds the free-to-use ATM network.

The consultation plans previously outlined by Link include a reduction in interchange rates over the next four years, from around 25p to 20p per withdrawal.

Link has said the plans will help to retain an extensive network of free ATMs for consumers.

But trade body the ATM Industry Association has warned that "ATM deserts" could be created.

In its letter to the PSR, Which? said it has "significant concerns" about the impact for consumers and does not believe proposals should be allowed to proceed without sufficient scrutiny from the regulator.

It said a wider review should consider potential alternative options for accessing cash and include a full examination of the ATM market.

Gareth Shaw, a money expert at Which?, said: "Significantly reducing this network could have a real impact on consumers, who might be left struggling to access the cash they need - and so we must see scrutiny from the regulator."

A spokesman for the PSR said consumers value the ability to access cash through a widely spread geographic network of free-to-use ATMs.

He said: "It is important for Link to consider whether its interchange fees encourage an ATM system that meets that need, while also providing value for money for consumers.

"Link's consultation on its proposals has now closed and we have been clear that we expect it to consider the impact on consumers when forming its decision.

"We are also monitoring the situation closely and taking steps to understand how it intends to take into account the feedback it receives, and assess the implications of its proposals for the provision of ATMs.

"If we consider that any decision Link makes is not in the interests of consumers, and is therefore inconsistent with our statutory objectives, we will take regulatory action as necessary."

In November, the Treasury Committee wrote to Link, to seek assurances over the accessibility of free-to-use ATMs.

Link has previously said the number of cash machines in the UK is currently at near-record levels, with more than 70,000 ATMs across the country, around 80% of which are free for consumers.