Number of free-to-use cashpoints will fall by 1,000 in just three months

The number of free-to-use ATMs will drop by 1,000 over the next three months after a major operator announced that more of its machines will charge a fee.

In another blow, state-backed lender NatWest and rival Lloyds announced the closure of a further 81 branches.

Notemachine, one of the largest independent ATM operators, will charge 15 percent of its currently free sites in the coming months, bringing the number it has converted over the past four years to nearly half of its total.

The free machines most at risk are the tens of thousands installed in convenience stores.

Chief executive Steve Makaritis blames recent cuts in the fees it receives from banks – and the government – on doing too little to protect free machines.

“Government legislation protects ‘access to cash’ but crucially fails to address the broken funding model that is forcing ATM operators to switch,” he said, warning: “Unless more cash is given, households will with a very small number of free-to-use ATMs.’

Only 3,300 UK ATMs have ‘protected’ status and are guaranteed to remain free. In February, the number of free machines fell below 40,000 – less than half of eight years ago.

Branch closures are the main cause. The UK’s 20 largest banks and building societies had 9,870 branches at the start of 2015, but plans announced so far say a total of 5,579 will be closed by the end of 2023, says Which?

The number of closures rises to 54 per month, the consumer organization calculates. NatWest and Lloyds announcements mean a total of 333 will close this year.

Banks say the popularity of online and mobile banking is leading to a rush of customers away from branches. But campaigners say older customers will lose a lifeline, especially when the last bank in a city closes.

Caroline Abrahams of Age UK said: ‘The scale of bank branch culling is a serious blow to the millions of elderly people who depend on branches.’