Cash Machine Use 40% Down

People are using cash machines 40% less than they were before the COVID-19 pandemic, although they are withdrawing more on average in every individual visit.

New figures released by the cash machine network provider Link have revealed that people are now visiting a cash machine twice a month on average, compared to three times a month, which was the average at the start of 2020.

On each visit, they are now withdrawing an average of £78.54, which is higher than the previous average of £66.99. However, because the number of visits has dropped, that means the total being withdrawn each month is now £44 lower — falling from £200.97 to £157.08.

Cash still important

The UK hasn’t completely abandoned cash yet, with the total value of withdrawals made at Link ATM machines standing at around £1.6 billion every single week. This value was £2.2 billion in 2019.

The latest Financial Lives survey, conducted by the Financial Conduct Authority, showed that five million people still use cash on a daily basis.

Link has also reported that in the last year, 400 communities have been in touch with the network asking for help getting easier access to cash — a problem that is exacerbated by the huge number of bank branches that are closing.

The lack of access is not necessarily the cause of the drop in withdrawals though. While cash withdrawals have dropped by 40%, the number of free-to-use cash machines has only dropped by 9% in the same time period, from 45,000 to 41,000.

Cities are impacted less by the lack of cash access, with Link’s data showing that some parts of Edinburgh and London have seen cash machine use fall by around 60%, higher than the average.

But the Financial Conduct Authority has said that it is people living in rural areas that are both relying on cash more, and having to travel further in order to access a machine and to make deposits.

While almost every urban resident of the UK has free cash access within 2km of their home, that figure drops to 75% when you look at the rural population.

Crucially, even though we're withdrawing almost £100m less per day, millions still rely on cash, especially in the most deprived areas…It is important we continue to protect access to cash across the country.

Nick Quin, Head of Financial Inclusion at Link

The charity Age UK has also made a statement, saying that people need the same guarantee of access to cash as they do for running water, electricity and access to postal services and that people could be excluded from society without access to notes and coins.

Contactless impact

More people have been making the switch to card payments, especially with the rise of the contactless limit to £45 at the start of the Coronavirus pandemic.

That limit has now been raised again, to £100, and as more businesses adopt card payment technology it will be interesting to see whether the cash machine usage figures continue to drop, and how the government will ensure that rural and older people are not left behind.