Massive confusion on cashpoint feesConfusion about cashpoint fees remains.

28 January 2006

Almost half of bank customers are confused about whether they can use the Big Four banks' cashpoints for free.

A new survey by Which? News has uncovered the huge confusion, which flies in the face of recent assurances by the industry that it's achieved significant improvements in making cashpoint charges 'transparent'.

In our survey, 49 per cent of current account holders didn't realise that they could withdraw money without charge from all the cashpoints of the Big Four banks: Barclays, HSBC, Lloyds TSB and NatWest.

Liz Edwards, Head of News at Which?, said: 'None of these banks charges for cashpoint withdrawals. But, given the findings, it's likely that many people are wasting time seeking out a machine run by their own bank to ensure they won't be charged - just because banks aren't being clear enough.'

Our survey asked consumers whether they'd be charged to use cashpoints at each of 15 major banks (but not their own bank). For all but two - Barclays and Lloyds TSB - at least half of the respondents simply didn't know whether or not they'd be charged to use these banks' machines.

All machines should be clear upfront

The figures for who didn't know whether they'd have to pay to use Barclays or Lloyds TSB's machines were only slightly lower: 47 per cent for Barclays, and 49 per cent for Lloyds TSB.

Currently, only two of these 15 banks charge. In both cases the fee is payable only at some machines, and only by other banks' customers. These are Alliance & Leicester (A&L;), and Co-op Bank. Both said they charged only where it wasn't economically viable to have a non-charging machine. A&L; charges up to GBP 1.75, and Co-op charges up to GBP 1.20.

In our survey, 95 per cent thought that no bank or building society should charge anyone to use its cashpoints. The same number wanted all cash machines to make clear, before you put your card in, whether there would be a charge.

Which? has long called for machines to be labelled with red (for charging) or green (for free) signs so you can see upfront whether you'll be charged. But Link, which runs the UK's cashpoint network, considers that warnings which appear on the screen are clear enough.

Labelling machines

Nationwide and HBOS have already adopted the Which? model, but most Link members have rejected the idea of labelling machines. However, Link said recently that it would commission further research into the issue.

Liz Edwards added: 'Some cashpoints are already upfront about charges, so why not all? Our survey shows that consumers want to know about charges before they put their card in. Labelling is the obvious solution.'

We spoke to 963 current account holders in our online survey, which was carried out last November by Explorandum. Respondents weren't asked questions on charges about their own bank, since no bank charges its own customers to use its cashpoints.