ACS (the Association of Convenience Stores) has welcomed a decision by LINK to cancel an interchange fee cut expected in 2020 and review future reductions.
The first reduction in interchange fees enforced by LINK of five per cent (equivalent to 1.25p per transaction) took effect on 1st July 2018, with the second five per cent reduction due to take place on 1st January 2019.
In a statement on its website, LINK said: ‘Following a six per cent year-on-year fall in the volume of ATM transactions, it has been decided by LINK’s board that the third reduction due in January 2020 will be cancelled and the fourth reduction due in 2021 will be put on hold, pending a further review next year.’
ACS chief executive James Lowman said, “We are pleased that LINK has listened to the concerns of retailers by cancelling the 2020 interchange fee cut and reviewing future cuts. However, it is clear that LINK’s original decision to reduce interchange fees over the next four years has already forced retailers to make tough choices about hosting ATMs in their stores”
“The Payment Systems Regulator must continue to closely examine the provision of free to use ATMs in the UK and be prepared to intervene if the cuts to interchange fees this year and in 2019 lead to gaps in the network where people don’t have access to free cash.”
Recently, the All-Party Parliamentary Group on Small Shops held an evidence session in Parliament about the impact of LINK’s interchange fees cuts on the ATM network for businesses and consumers. ACS used this meeting to call for transparency from LINK about its monthly reporting on ATMs and the Financial Inclusion Programme to the Payment Systems Regulator (PSR).
LINK confirmed it will publish its monthly reports on the ATM network and that retailers can contact LINK directly to confirm their ATMs eligibility for the Financial Inclusion Programme.
ACS also wrote to Nicky Morgan MP, chair of the Treasury Select Committee, calling for both the Committee and the PSR to clarify the number of cash machines that would be protected by the 1km proposal, expressing concerns that removal of cash machines could have a negative impact on communities.
The 2017 Local Shop Report shows that 58% of stores in the convenience sector have a cash machine. 45% of stores provide a free to use cash machine, while 13% have charged cash machines.
LINK’s full press release can be found here.
