A bunch of banking bigwigs are having a pow-wow in London today – and what they decide could have a noticeable effect on my day-to-day finances. Here’s why. The special committee is discussing what are called interchange fees on cash machine withdrawals. These charges are levied on your bank every time you withdraw money from your account from a rival bank’s machine. The BBC says that the typical fee is 25p per transaction. So given that there were about two billion cash withdrawals last year from Link machines, and not all of them will have been from the cardholder’s own bank, that’s a serious amount of money.
The problem seems to be that those banks with lots of customers are unhappy about the fees they pay. The committee is going to report later this year. Doom-mongers say it could spell the end of free cash withdrawals.
I am old enough to remember back in the last century when you used to be charged if you used another bank's machines. Then, it wasn’t an issue for me – I lived in London where there were tonnes of cash machines everywhere and it was easy to find one for your own bank. Now I live in the country, that’s not so. With dwindling bank branches (see my blog earlier this week) it would be a total pain if I had to pay to get at my money.
While some will say cash is dying out, we will always need it. My window cleaner doesn’t take cards. Neither does my son’s French teacher. Nor the nice man who delivers eggs from the local farm. I would feel silly paying for a coffee in a café with a card – assuming they take them. The local newsagent will take cards, but only if you spend at least a tenner, otherwise there’s a charge. And the best way to make sure you don’t overspend when out shopping is to leave the cards behind and withdraw cash. I don’t know what the solution is for the cash machine operators over fees, but I hope they remember those of us living outside the big metropolitan areas when they make their decision.