3rd Apr 2020
The shutdowns as a result of the COVID-19 outbreak have led to a sharp drop in cash transactions, which is putting the future of ATMs – and their regular users – at risk.
According to LINK, which runs Britain’s 70,000 cashpoints, the number of ATM transactions fell 50% in March 2020 compared with the year before.
Following government advice, fewer people are going out and, when they do, they are encouraged to use cards – and, where possible, contactless payments – to reduce the risk of cross-contamination. Contactless payment has even been made easier, as last week the limit was increased from £30 to £45.
Before the shutdown, cash was used in about a third of transactions, but LINK has predicted this will fall to just 10% by August – a figure the UK wasn’t meant to reach for another five years.
Research shows that once people switch to using cards and digital payments, they rarely go back to cash payments.
John Howells, Chief Executive of LINK, has said this fall in cash transactions could see many ATMs close, while those that stay open might have to increase withdrawal fees to remain profitable.
Older and more vulnerable people will be worst hit, as they may be less comfortable making card payments and could be forced to travel miles to withdraw cash.
Howells has warned other people will also be affected. Tourists visiting Britain who want to withdraw money could struggle, not to mention the self-employed who only accept cash and the 1.4 million people who don’t have a bank account.
Howells said: “Cash use is not going to come back again and resume its slow decline.” He continued: “We are simply not ready to move to digital systems, because they do go wrong”.