Just show me the money

by Sarah Modlock

8 February 2005

I don't know about you but a trip to the cashpoint is not the highlight of my day. For starters, it is rare to find one without a queue. Then there's the modern day security paranoia: 'Is there a plastic loop in the machine to help fraudsters clone my card?' or 'That man is standing very close - is he trying it read my PIN or swipe my cash?'. Like most people, I'm usually too focused on what I need to do with the money to worry unduly about cashpoint horrors. The biggest threat I feel from the people queuing behind me is that they will lynch me if it takes me longer than 20 seconds to get my money and vamoose.

Bizarre then to consider that our banks want to personalise the process and deliver a whole range of new services through our ATMs. In future, the data contained in the little black strip on the back of your plastic will trigger a series of messages designed to make cashpoints more friendly and helpful. Expect to be greeted by name when a welcome messages flashes onto the screen; mercifully, there is no move to provide ATMs with an automated voice yet. You may also be reminded that key dates for such happy events as a spouse's birthday or insurance renewal are imminent. Of course, one way to avoid this is to make sure you don't give these dates to your bank. But it makes me wonder what happens if you don't visit the cashpoint for a couple of weeks and miss the date in question. Will you slip your card in to be told 'Tut, tut. You missed his birthday. Withdraw extra cash today to buy a guilt-ridden present'. Or 'Did you forget to renew your home insurance policy? We hope you don't get burgled. Please remove your card and wait for your cash'.

Personal services

Apparently we are way behind the curve on this new technology, which has already proved successful in North America and Asia, according to manufacturer NCR. 'ATMs are the most frequent way that people interact with their bank, so it is no wonder that banks want to improve services through personalisation,' says Simon Rubin, NCR's vice president for financial self-service solutions for the UK. 'We could expect to see the first personalised ATM in the UK within a year.'

A warm hello and diary reminders are not all the new ATMs will deliver. Just like the buxom barmaid in your favourite pub, the machine will immediately prepare to deliver your 'usual' amount of cash. Presumably you can intervene at this point and change your order if you need something different, like a creme de menthe frappe instead of two twenties and a ten. But here's the best bit. In the future, NCR says cash machines would also offer sports scores and allow customers to check share prices while they withdraw cash. Can you imagine? For a nation where delaying a cashpoint queue while you check your balance or - heaven forbid - order a chequebook puts your very life in danger, football results could tip us right over the edge.

It's no use fighting it though. A number of banks have already expanded the range of services they offer through cash machines. Abbey and Royal Bank of Scotland offer pay-as-you-go mobile phone top-ups via ATMs. Nationwide provides an instant cheque payment system at 184 of its ATM machines, which give users a photocopy of the cheque they have paid in with their receipt. 'It processes very quickly and you've got an assurance that the cheque has been paid in,' says Richard Lyle of Nationwide.

Money for nothing

Of course the one thing we really want from our cashpoints - apart from money - is no fees. At this month's meeting of the influential cross-party Treasury Select Committee, bank chiefs and cashpoint companies were grilled about the increase in ATM charges. According to James Crosby, the chief executive of HBOS which owns Halfax and Bank of Scotland, more fee-charging machines were being introduced because they earned more money for ATM site owners. Well at least he was honest. He said that half of all cash machines are likely to charge a fee for their use in the future. But we're not far off that now. Expect to pay a fee when using an estimated 19,000 of the current 50,000 ATMs in the UK. Most of the growth has come from fee-charging machines being installed in locations where there was no bank-operated free ATM, such as pubs, post offices and petrol stations. Some banks, such as HBOS and Abbey, have sold their non-branch based ATMs to fee-charging providers.

Benny Higgins, RBS chief executive of retail banking, was keen to stress that his bank had increased the number of free ATMs in the last year. But he said the fact that fee-charging machines brought in more money meant the switch to fee-charging ATMs would continue. 'There will be more of it. After all, it is a free market,' he said. Free market indeed. With fee-charging cash machines typically charge users between £1.25 and £1.75 a transaction, it is easy to see how the companies operating them made a total of £140m in fees last year.

In sometimes heated exchanges with MPs, senior executives of four major fee-charging ATM providers - Moneybox, Cardpoint, Bank Machine and TRM - swore blind that their businesses were fulfilling a consumer need. 'The vast majority of our customers repeat-use our service week in week out,' Mark Mills, chief executive of Cardpoint, told MPs. Are we really that lazy? Since April 2004, ATM operators have had a duty to warn customers if their machine will charge. But in most cases, the warning - and the amount to be charged - is not shown until near the end of the transaction when you have all but got your hands on the cash and are unlikely to cancel the request.

In future, it looks like we will all need to plan ahead to avoid being caught without cash and at the mercy of mean ATMs. Look out for stickers and signs revealing fees or promoting 'free balance check'. Use your debit card where you can and make the most of cashback offers at the supermarket and elsewhere. After all, we shouldn't have to pay to get our hands on our own money.