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Money: ATM Machines

Volume 703: debated on Thursday 17 July 2008

My honourable friend the Economic Secretary to the Treasury (Kitty Ussher) has made the following Written Statement.

Following the March 2005 Treasury Committee report on ATM (automatic teller machine) charging, the Treasury invited the chairman of the Treasury Select Committee, the right honourable John McFall, to chair a working group on ATMs to take forward work on key issues. The working group, which included banks, independent ATM operators and consumer groups, published its report on 13 December 2006.

The working group announced an agreement to provide around 600 new free cash machines across 1,707 target low-income areas that it identified as lacking convenient access to these machines. To achieve this, a market-based financial incentive—known as a financial inclusion premium—was introduced, to encourage ATM operators to place or retain free ATMs in deprived areas with a low expected volume of transactions. The working group also agreed to implement improved transparency rules for charging cash machines. Since publication of the working group report, LINK has assessed around 10 per cent of the identified low-income areas as unsuitable for an ATM location as there is no centre of population.

The Government are pleased to report that the industry has, over the 18 months following publication of the working group's report, made excellent progress towards its goals of placing around 600 non-charging machines in low-income areas across the UK, with around 2 million individuals on low incomes standing to benefit.

As of 30 June 2008, sites for 562 of the 600 new ATMs required have been identified. Of these, 419 new free machines are already in use and issuing cash to the public. 74 per cent of these ATMs that are based in the target deprived areas receive the financial inclusion premium. Encouragingly, nine of these new cash machines have proved so popular that their level of withdrawals means that they have now graduated from the financial inclusion premium scheme.

Banks, building societies and independent ATM operators have all contributed new free-to-use cash machines; independent ATM operators have provided or are in the process of supplying around 35 per cent of the confirmed new non-charging ATMs. The UK ATM network, LINK, is continuing to work with its member banks and ATM operators to identify suitable sites in the remaining target areas, and is engaging closely in this exercise with Members of Parliament, local authorities, consumer councils and retailers.

The benefits in terms of financial inclusion are clear. Data from LINK suggest that the new ATMs currently in operation or under contract will enable almost 1.3 million residents in the target low-income areas to access cash more conveniently and manage their money more effectively.

In terms of improved transparency, operators of cash machines that charge users for withdrawals and that can upload screens remotely have met the end-June 2007 deadline to improve the on-screen standards of at-a-glance signage. This means that it is clear to a consumer when a charge is applied when withdrawing cash. Good progress was also made by operators in enhancing external signage by end December 2007.

The Government are encouraged by the substantial progress achieved, and would like to take this opportunity to thank all of those involved in extending free access to cash to those who need it the most.

Full details about progress made are available on the LINK internet website at:

I will be issuing a final Statement on the progress stemming from this initiative this December.