UK convenience stores blast ATM interchange rate reductions

The Association of Convenience Stores, a U.K.-based trade group, has condemned the decision by Link to reduce interchange fees for ATM operators. In a press release, the organization raised concerns that machines in rural and isolated communities could be lost as a result of the changes. 

Link is moving forward with a four-year plan to reduce the interchange fee that banks pay to ATM operators from 25p to 20p. The first of these reductions was implemented on July 1. 

ACS cited figures from the consumer group Which? suggesting that the planned rate cuts have resulted in the removal of as many as 1,500 ATMs since November. The watchdog group claimed that rural areas have been affected slightly more than urban areas, despite Link's insistence that closures of redundant machines ultimately will expand the geographical footprint of ATMs in the U.K. 

"Link's decision to press ahead with cuts to interchange fees is already leading to retailers having to make difficult decisions about the future of their cash machines, potentially leaving rural and isolated communities without access to cash," ACS chief executive James Lowman said in the release.

"Retailers cannot be expected to subsidise the network, especially when the big banks, who are profiting from the interchange fee cut, are closing branches in their thousands and abandoning consumers across the UK. The Payment Systems Regulator must intervene if consumers' access to cash continues to be affected."

ACS has also reiterated its calls to government to remove free to use ATMs from the business rates rating list, which taxes the machines as a "business with a business. Crossing ATMs off the list could save ACS merchants thousands of pounds annually, the release said.

According to Lowman the tax bill for through-the-wall cash machines can, in some cases, be higher than the total rates bill for the store where the machine is located.

The 2017 Local Shop Report shows that 58 percent of stores in the convenience sector have a cash machine, the majority of which are free to use.


Topics: Distributors / ISO / IAD, Regulatory Issues, Retail / Off-Premises


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