News / The University of Bristol
Decline in free ATMs hitting most vulnerable communities
The decline in free ATMs has sparked concern that more vulnerable communities are at risk of getting left behind as digital payments continue to grow.
A report published by the University of Bristol in partnership with the Financial Conduct Authority (FCA) and Payment Systems Regulator (PSR) has mapped for the first time how far people have to travel to access cash across the UK.
It found that while the majority of high streets still have free-to-use cash points, the number fell by around a fifth (19 per cent) between March 2018 and March 2020. This exceeds the fall in the number of cash withdrawals from ATMs, which fell by 15 per cent over the same period.
In contrast, the number of pay-to-use ATMs increased by nearly a quarter (23 per cent) in the most deprived communities.
Dr Daniel Tischer, who led the research, said there is particular concern about the recent rise of facilities that charge people to withdraw their money in areas where people tend to be more reliant on cash in their daily lives to pay for shopping, budget or cover bills.
Proximity to free-to-access cash across the UK – source: University of Bristol report
“If current trends continue, older people and those on low-income may find themselves in a position where they have to pay for cash or face walking longer distances which may not always be possible, especially for those suffering from poor health,” said Tischer.
“Cash usage is no doubt declining, but many people continue to rely on cash while many others continue to prefer to use cash for some payments.”
The report, Where to Withdraw, which was published on Thursday, found free access to cash is readily available on 99 per cent of UK high streets within 500 metres, and 77 per cent of neighbourhoods.
Areas of high deprivation currently have three times the number of free-to-use ATMs than the most affluent neighbourhoods so the impact on consumers has been limited, but the trend is towards a decline in cashpoints that don’t charge.
The impact of these changes is that for each pay-to-use ATM in poorer neighbourhoods, there are now less than three free cashpoints, down from almost four in 2018. More affluent areas have up to five free-to-use ATMs for each pay-to-use machine. Pay-to-use ATMs are not owned by banks but by private operators and typically charge a flat fee of at least 95p per cash withdrawal.
Researchers found cashback generally increases the options for people to access their money but under the current system it has drawbacks, including requiring the customer to make a purchase.
The report follows a study published by the university in 2019, which found the people most reliant on, and likely to use cash, live in the areas of Bristol that have witnessed the biggest decline in banks and free ATMs.
“There is a lot of work that needs to be done to assess the impact the current closure of bank branches and disappearance of free-to-use ATMs has on local communities and we need to ensure free access to cash is available to all, but in particular those who depend on it most,” added Tischer.
In the spring budget, the government pledged to introduce new legislation aiming to protect access to cash across the country. This study will help inform ow the UK protects access to cash, mapping more than 110,000 points where money can be accessed.
The research funded by LINK, the UK’s largest ATM network, was supported by the Post Office, and UK Finance, which gave access to data.
Chris Hemsley, the managing director at PSR, said: “Nobody should be left behind as digital payments continue to grow. We know that future models of cash access will likely require changes to the current network of ATMs and will likely include a wider range of ways to access cash.
“We want to see creative solutions that work for people and meet communities’ needs for cash, and that offer a variety of options for everyone.”
Read more: How the rise of a cashless society is leaving some people behind
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