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Fee-charging ATMs hit the poor

Fee-charging ATMs in the UK have a disproportionate effect on the poor, with some deprived areas lacking any free cash machines at all, according to a report from the Citizens Advice Bureau.

The report says that fee-charging machines, where customers must pay a fee for a withdrawal, are often the only choice in deprived or rural areas where banks and building societies have withdrawn free services. Four out of ten cash machines in the UK are fee-charging and the average cost per withdrawal is GBP1.50, although some ATMs charge as much as GBP3.00.

The report identifies areas described as free ATM deserts, areas without free ATMs which are often deprived or have high numbers of pensioners. Chapeltown in Leeds, for example, has no free ATMs yet has ten fee-charging machines and was identified as one of the most deprived areas in the UK. Rural areas such as Hightown in Merseyside without free ATMs affect those on low incomes who would need to travel miles in order to reach the nearest free machine.

The UK’s largest bank HSBC has responded to the report by pledging 500 free machines to its 2,900-strong ATM network over the next few years.

David Harker, chief executive of Citizens Advice said: This is becoming a growing problem. People on low incomes need to take out small amounts of money and more frequently, but they should not be penalized as a result.

Rural communities are amongst the worst affected, where people may have to travel miles to the nearest free cash machine or pay a high charge. We welcome responses from banks such as HSBC to look at placing new free machines in areas we think are free ATM deserts.