If you thought that the issue of the conversion of free ATM machines into fee-charging ones was a long-forgotten story, well, then this piece of news could serve as a perfect reminder.
Top cash machine operator, Cardpoint, disclosed that it had its cash registers ringing as 275 of its free ATM machines bought from HBOS had been converted into fee-charging ones and were bringing in attractive profits. Cardpoint announced that its profits for the year ending September 30 would fulfill analysts’ forecast.
It is no surprise that charging machines are bringing in so much moolah for operators like Cardpoint, as some of these machines impose a charge of about £1.75 for every cash withdrawal and still have customers returning for the same.
At this, the Nationwide building society, which has been on the forefront against the charging machines, will be raking up the controversial issue once again, along with particular suggestions to help users differentiate clearly between free and fee cash withdrawal machines. In fact, other activists including a few MPs have sent out alerts saying that the country could soon be devoid of free-to-use ATM machines if nothing is done to curb the widespread spurt of charging ATMs.
About five years back all ATM machines operating in the country were free-to-use, but now, a sizeable 20,000 out of 54,000 ATMs, i.e. a whopping 40% of the total amount have been converted into fee charging ones and charge no less than £1.50 for each cash withdrawal.
Meanwhile, activists assert that this crisis has emanated from the selling of ATM machines by high-street banks to separate cash operators who were in turn levying charges and profiting by them. For instance, HBOS’s 816 machines were bought by Cardpoint, out of which 275 have already been converted into charging ones.
Chief executive of Cardpoint, Mark Mills, commented, “The profit on each of these 275 machines, once converted to charging, has been higher than anticipated due to both higher retention and charging rates with excellent future visibility.”
While adding that about 300 of its HBOS machines were still operating as free ones, he warned that there were high possibilities of them being converted too.
Calling itself a leader in the independent ATM sector, Cardpoint has just acquired its opponent Moneybox and boasts of at least 5,000 cash machines. On Wednesday, it appointed ex-managing director at the BT group, Michael Hepher as the company’s chairman. He will be replacing Peter Smyth who will now function on the board as a senior non-executive director.
Posted
on : Thu, 29 Sep 2005 17:05 GMT | Banking News
By : Paula Jenkins
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