The Association of Convenience Stores (ACS) has welcomed a decision by LINK to cancel an interchange fee cut expected in 2020 and review future reductions.
The first reduction in interchange fees enforced by LINK of 5% (equivalent to 1.25p per transaction) took effect on 1 July, with the second 5% reduction due to take place on 1 January 2019.
In a statement on its website, LINK said: ‘Following a 6% year-on-year fall in the volume of ATM transactions, it has been decided by LINK’s board that the third reduction due in January 2020 will be cancelled and the fourth reduction due in 2021 will be put on hold, pending a further review next year.’
John Howells, chief executive of LINK said: “LINK is committed to maintaining the UK’s extensive coverage of free-to-use cash machines for many years to come. However, many consumers are turning to alternatives to cash more quickly than expected and usage of ATMs is now dropping at 6% per annum.
“LINK will therefore adjust interchange to maintain free-to-use coverage in line with our commitments to the public and to our participants. LINK will continue to monitor the cash machine network carefully and will not hesitate to make further changes as needed to protect UK consumers.”
ACS chief executive James Lowman said: “We are pleased that LINK has listened to the concerns of retailers by cancelling the 2020 interchange fee cut and reviewing future cuts. However, it is clear that LINK’s original decision to reduce interchange fees over the next four years has already forced retailers to make tough choices about hosting ATMs in their stores”
“The Payment Systems Regulator must continue to closely examine the provision of free to use ATMs in the UK and be prepared to intervene if the cuts to interchange fees this year and in 2019 lead to gaps in the network where people don’t have access to free cash.”