Member Article

Fee-charging cash machines hitting the poorest

Poorer people are increasingly being charged to withdraw money from cash machines, according to research from national charity Citizens Advice. The average cost per withdrawal is £1.50, but some fee-charging cash machines charge as much as £3.The research identifies ‘free ATM deserts’ – areas, increasingly common in deprived areas, which have no free Automatic Teller Machines (ATMs). In the North East, ATM deserts exist in: Bowburn DH6; West Auckland and Woodhouse DL14; Allendale Town and Allenheads NE47; Ellington and Stannington NE61; Alnmouth, Longhoughton, Craster, Whittingham NE66; Fishburn TS21; The Headland, Hartlepool TS24; Blackhall Rocks, Eliwick Village, Hart Village TS27; and Trimdon TS29.Fee-charging cash machines have a disproportionate impact on people on low incomes and those claiming benefits, as benefits are paid directly into bank accounts, and people on low incomes tend to withdraw small amounts more frequently. Some hospitals only have fee-charging ATMs so patients have to pay to withdraw money, whilst fee-charging ATMs are increasingly prevalent on university campuses, leaving students with little choice but to pay to withdraw money, potentially adding to their mounting debts. In 1999 virtually all cash machines in the UK were free, but of the 58,000 cash machines now operating, 40% charge a fee regardless of the size of withdrawal. In addition, in a survey of 265 people, nearly half said that they were not warned in advance that they would be charged for a withdrawal. 41% of fee-charging machines did not have a sign saying they were fee-charging, and 11% of fee-charging cash machines did not have an on-screen warning.David Harker, Chief Executive of Citizens Advice commented: “This is becoming a growing problem. People on low incomes need to take out small amounts of money and more frequently, but they should not be penalised as a result. Rural communities are amongst the worst affected, where people may have to travel miles to the nearest free cash machine or pay a high charge. We welcome responses from banks such as HSBC to look at placing new free machines in areas we think are free ATM deserts.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .