Paid ATM machines upset MPs |
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Published
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Mon, 04 Apr 2005 01:00
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A United Kingdom’s Treasury Select Committee report has demanded that large visible signs near charging ATM machines be put up so that users are warned of the extra cost incurred while making cash withdrawals. The report avers that users are paying £140 million a year to withdraw their own money from ATM machines.
Britain’s Members of Parliament (MP) have also expressed concerns about the replacement of free cash machines with charged ones, a fact that could cost low-income groups dear. They have asked the Post Office to reevaluate its ATM policy, keeping in mind the needs of the local community. The report said, “The Post Office has a responsibility to move towards greater provision of free machines, particularly when there are no banks nearby.” About 75 per cent of the ATM machines located at post offices are ones that charge.
| According to the MPs, about four out of 10 ATM machines are paid ones and have replaced free machines in many locations. Generally, users are charged between £1.25 and £1.75 per transaction at such ATMs.
According to the report, labels warning users about transaction fee are generally placed in inconspicuous locations and warning screen prompts also come late, when the user is just about to withdraw the required amount. In addition, these machines advertise ‘free’ balance inquiries prominently and thus misguide users.
Chairman of the committee John McFall said that access to non-charging machines should be available to all consumers and forcing some people into paying £1.50 per withdrawal is ‘unfair’. “This is a very worrying trend and one that should be monitored closely. It would be wrong if every withdrawal was to hit consumers in their pocket,” he said.
The committee has also asked that UK’s Banking Code be extended to charged ATM machines, and that banks ‘think carefully’ about giving off their free ATM sites to providers who charge.
ATM providers, however, assert that less that 4 per cent of transactions are through charging machines. According to them, charged machines are generally located in areas that might otherwise not have the ATM facility at all. A spokesperson of the Association of Payment Clearing Services (APACS), said the requests of the committee would be considered by the industry. “I am glad that MPs recognize that 97 per cent of cash machine withdrawals are free and that UK consumers get a good deal, particularly when compared to other countries,” she said.
Meanwhile, consumer associations have hailed the report’s demands. Laurence Baxter of Which? said, “Easy access to cash, free of charge, must be protected. The massive growth in charging threatens people's right to get hold of their money for free.” He said a research undertaken by his group showed that many people are confused about whether they are being charged at ATMs or not. “More than one in four people still don’t realize that they will be charged for taking cash out at convenience machines,” he said, adding, “Message to banks: enough is enough!”
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