ACS: Interchange Fees Cut Could Threaten Free to Use ATM Network

ACS (the Association of Convenience Stores) has responded to a consultation from cash machine network operator LINK, raising concerns about the impact that the proposals could have on local shops and their customers if the number of free to use ATMs were reduced.

In the consultation, LINK proposes to reduce the level of interchange rates (the fee paid by card issuers to ATM operators) by 20% over the next four years. They state that they intend to ‘retain an extensive network of free ATMs for consumers’ but that ‘the proposed changes are a result of a predicted fall in consumers’ demand for cash for payments’, suggesting that the number of free ATMs available to customers could fall as a result of the proposals.

ACS chief executive James Lowman said: “Consumers want easy access to cash, and this is often provided by ATMs at convenience stores. The majority of local shops offer ATMs, with most of them being free to use.

“The reduction in interchange fees, payable by banks for their customers to use these facilities, would change the economic model for offering ATMs. If this leads to some cash machines being removed from local shops, the impact will be felt not just by them, but by other shops, small businesses and markets which benefit from customers having cash to spend. LINK, and the government, need to think carefully about the wider economic and social consequences of the ATM network shrinking.”

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. Cash also remains an essential method of payment for customers in convenience stores. HIM research featured in the 2017 Local Shop Report shows that 76% of customers pay in cash.

The full consultation details are available on the LINK website here:

This entry was posted by Chloe on Wed, 01/11/2017 - 14:45