Cash has just five years left, warns ATM boss

cash machine
cash machine

The chief of the UK’s largest ATM network has warned that cash has as little as five years left, as the country’s infrastructure experiences “death by a thousand cuts”.

“The cost of providing cash infrastructure, which includes the ATMs, security and bulk cash centres is huge at £5bn a year,” said John Howells, chief executive at Link. Many of these costs are fixed and will not change as consumers move to digital payments.

Since the beginning of the pandemic, “cash use is down by 40pc – and is still falling,” he added. A recent report from UK Finance, the banking trade body, estimates that just one in every 20 transactions will be made using cash by 2031.

“This infrastructure will start to fall apart unless something is done, and we are already seeing ATMs and branches closing at a worrying rate,” said Mr Howells. “Our cash infrastructure is experiencing death by a thousand cuts.”

An estimated five million people who rely on cash – many in rural locations or less well off – are at risk of being left behind unless more is done to help them adapt to digital, Mr Howells said.

“We have 5-10 years to fix digital payments before cash becomes unworkable, and need to start planning how to get the new system working for all.”

Link runs the UK’s network of around 54,000 cash machines and works with almost all UK banks and card issuers.

According to Link, the number of free cash machines has dropped by more than a fifth in four years, from 52,358 in 2018 to 40,830 today.

Next month, parliament will return from its summer recess to consider legislation that will protect access to cash, as outlined in the Queen’s Speech earlier this year.

Mr Howells expects Link to be handed the responsibility of setting up shared banking hubs in communities that have lost their last branch.

Under pilot schemes in Cambuslang, Lanarkshire, and Rochford, Essex, banks have worked jointly to offer basic cash services through designated high street hubs. Ten more locations are in the process of being set up across the country.

Natalie Ceeney, chairman of the Banking Hub Company, said a few hundred hubs will be needed to meet demand and to prevent the UK “sleepwalking into a cashless society”.

Published by anthonyhayble

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