Cash Machine turns 40

The term ‘robot cashier’ sounds a little ridiculous now but that was the name for cash machines when they were first used 40 years ago this week.

Until then we had to queue up in banks, making sure we were there between 9.00 and 3.00 to get our hands on our cash. Now the machines are by far the most popular way for us to access our money, with around two thirds of the population using them on a regular basis.

But could we be falling out of love with the reliable ATM? Nationwide calculates that machine charges are costing consumers £60 million a year, with the number that charge rising from 13,000 to 18,500 in the past six months. With credit card companies also charging high fees for cash withdrawals the hole in the wall could soon be a pain in the neck.

Forget the credit card

Many credit card companies now allow you to withdraw cash from ATMs. While the thought of a fistful of tenners might be tempting it may be also be costly.

The average APR charged for customers using an ATM and not clearing the balance is now 23.48 per cent, whilst the highest, according to, is an eye-watering 46.19 per cent.

While those who don’t clear their balances may face huge costs, even those who do will be charged – card firms impose a fee for withdrawing cash which may be as high as three per cent. Only Egg Money does not charge.

If you’re intent on taking out cash, the best advice is to use your overdraft facility on your debit card instead of a credit card. Average authorised overdraft rates are just 12.3 per cent, almost half the average credit card cash withdrawal levy.

Foreign Fees

A handful of banks don’t charge for using ATMs abroad, and only one – Nationwide – won’t charge you for the conversion fee either, meaning its current account is the only one you could use abroad to get cash completely free with a debit card.

That means everyone else will charge you something – so check what your bank does now so you can decide how to pay for things on holiday before you travel.

The most expensive are:

Bank / Building Society Handling fee ATM charge Cost of £100 withdrawal
Natwest / RBS 2.65% 2.25% (max £4) £4.90
Lloyds TSB / Smile / Woolwich 2.75% 2% (min £2) £4.75

As most have a minimum charge, the golden rule if you have to take out cash is ‘the more the better’ per withdrawal. Taking out a tenner is going to cost you proportionally more than taking out £100.

Bung it on the card

If recent trends continue there could be more fee-charging machines than free ones before the year is up. But there are rules forcing them to have stickers or on-screen messages warning of the charges, so there’s no need to get caught out.

With almost every retail outlet now accepting debit or credit cards for purchases of almost any value there shouldn’t be a need to use fee-charging machines to get at your cash.

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