Procurement · 22 January 2018

ATM network funding cut would further threaten remote businesses

Consumers and business owners in remote areas must rely on neighbouring communities to access cash

Small businesses in over 100 local UK communities, that don’t contain a single ATM, would be hit hardest by proposals from LINK that could lead to mass closures of free-to-use ATMs across Britain, research has warned.

A report from consumer watchdog Which? found that there are 123 UK postcode districts, with a combined population of 110,935, where there currently isn’t a single ATM.

Meanwhile, there are a further 116 postcode districts where there’s just one ATM, 37 of which charge a fee for use. As a result, consumers and small business owners in these remote areas rely on neighbouring communities to access cash.

The findings come just days ahead of the 31 January deadline for LINK – operator of the UK’s largest network of cash machines – to announce whether it will progress with plans to reduce the fee paid to its ATM providers by 20 per cent over the next four years.

The fee in question is currently set at 25p, and is paid by banks per withdrawal in order to maintain Britain’s network of free-to-use ATMs.


High streets threatened by potential loss of thousands of free-to-use cash machines

LINK, the UK’s largest cash machine network, is holding a consultation with the 30 banks and building societies it represents over reductions to the “intercharge” fee


With many rural areas already struggling to access cash following bank branch closures, LINKS’s proposals are likely to put even further strain on rurally-based businesses, should they go through.

LINK, however, has said it will encourage operators to keep free cash machines, and to protect free-to-use ATMs that are a kilometre or more from the next nearest free cash machine.

National chairman at the Federation of Small Businesses (FSB), Mike Cherry, said that if LINK’s plans went ahead and funding for cashpoint providers was cut, things could go from bad to worse for small businesses in remote parts of the UK.

“What’s really worrying about LINK’s proposals is that it’s the cash machine providers with a majority share of the remote ATM market that are most concerned about a potential drop in funding,” he added.

“As is so often the case, it will be rural small businesses that are hit hardest by inadequate investment. The UK’s cash machines network is already failing small businesses, particularly in rural areas and tourist hotspots where cash flow is absolutely vital to local growth.

The research revealed which postcode districts had the worst cash machines provision throughout the UK – with either very poor access, or no access at all, to ATMs.

District PE32 in Norfolk was found to be the most populated of these areas, with 15,294 residents. Other communities that fell into the same bracket of poor ATM provision, or no access at all to ATMS, included: TA7 in Somerset (14,982 people), TN27 in Kent (12,404 people), NR16 in Norfolk (11,953 people) and YO13 in North Yorkshire (10,111 people).

Cherry went on to say: “Small firms now find themselves between a rock and a hard place when it comes to customer payments.

“On the one hand, unable to recover the various costs they incur when processing card payments. On the other, faced with customers who are finding it harder and harder to access cash because of an increasingly threatened bank branch and cash machines network.”

Small businesses at risk from potential loss of thousands of cash machines

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Fred Heritage was previously deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London.

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