Money Mat­ters

The Oldie - - CONTENTS - Mar­garet Dibben

Tens of thou­sands of ATMS will close down if two quite dif­fer­ent pro­pos­als go ahead. Cash ma­chines are al­ready dis­ap­pear­ing at the rate of 500 a month as bank branches close and in­creas­ingly we use less cash. Any new ones open­ing are usu­ally in city cen­tres where there is al­ready an over­sup­ply: 80 per cent of free-to-use ATMS are within 300 me­tres of each other.

There are broadly two types of cash ma­chine. Some are owned by banks in their branches and high-vol­ume ar­eas such as su­per­mar­kets. Others are stand-alone con­ve­nience ATMS run by in­de­pen­dent providers who earn money each time you make a with­drawal; these are lo­cated in less pop­u­lous places such as con­ve­nience stores, pubs, petrol sta­tions and hos­pi­tals. Nearly all with­drawals on debit cards are free, though a few charge (usu­ally around £1.50).

One at­tack on ATMS is com­ing from the Val­u­a­tion Of­fice Agency (VOA), which ad­min­is­ters busi­ness rates. Its ac­tions have left re­tail­ers with ATMS, such as su­per­mar­kets, not know­ing if they can re­claim £300 mil­lion of busi­ness tax paid or face hav­ing to shell out an ad­di­tional £5,000 in tax for ev­ery ATM they pos­sess.

In 2013, re­tail­ers with ATMS out­side their premises – hole-in-the-wall cash ma­chines fac­ing the street – were told to start pay­ing busi­ness rates on the sites of these ma­chines, in ad­di­tion to the

busi­ness rates they al­ready paid for their premises. They ap­pealed but the de­ci­sion was up­held last year.

Even though it won, the VOA also ap­pealed; it now wants to tax ATMS on the in­side as well. Su­per­mar­kets are fight­ing back. A de­ci­sion fol­low­ing a Court of Ap­peal hear­ing is im­mi­nent but the los­ing side will most prob­a­bly ap­peal to the Supreme Court. The is­sue will not be re­solved for a long time. If the VOA wins, many shops will rip out their in­side ATMS to avoid pay­ing the ex­tra tax. As many as 40,000 are at risk, and this could leave us where we were some years ago with the only free ATMS be­ing hole-in-the-wall ma­chines.

A VOA win would also have other ram­i­fi­ca­tions. Busi­ness tax could then be ar­gued to ap­ply to shops’ in­ter­nal vend­ing ma­chines, cof­fee ma­chines and chil­dren’s rides.

The other at­tack on cash ma­chines is a plan by Link, which over­sees the ATM net­work, to slash their in­come. Each time you make a with­drawal, the ma­chine op­er­a­tor earns 24p from your card is­suer, un­less that hap­pens to be your own bank. This is how they sub­sidise free with­drawals. Link cut the fee last July from 25p and in­tended bring­ing it down to 20p over the next four years.

In­de­pen­dent op­er­a­tors warned they would have to close up to 30,000 cash ma­chines as they be­came un­prof­itable. Link re­cently changed its mind to limit the im­pact. Next Jan­uary’s cut will go ahead but the third has been can­celled and the fourth is un­der re­view.

To main­tain a ser­vice for vul­ner­a­ble cash-users liv­ing in re­mote ar­eas, ATMS more than one kilo­me­tre from the next free cash­point re­ceive 30p. In­ner-city dwellers have plenty of ATMS and are more likely to shop with debit cards than cash. Free cash ma­chines for those liv­ing in ru­ral ar­eas, par­tic­u­larly older peo­ple, must be main­tained at any cost.

‘Have you swiped your Nec­tar card?’

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