Quick summary: Protected and Free-To-Use ATMs

In December 2021 the Payment Systems Regulator (PSR) published an extension to Specific Direction 8 (SD 8) which requires LINK to do all it can to fulfil its commitment to maintain the broad geographic spread of free-to-use (FTU) ATMs.

In this blog we provide a quick summary of the Specific Direction with relevant links to the PSR’s website.


Extending Specific Direction 8 (SD 8)

Cash remains an important payment method for many people and the PSR wants to ensure people and businesses continue to have access and confidence in the ATM network. The PSR state that, since its publication in 2018, SD 8 has been successful in ensuring that LINK implements a coherent set of policies and practices to meet its commitment towards ensuring a board geographic spread of FTU ATMs.

In light of this success the Payment Systems Regulator (PSR) has extended Specific Direction 8 (SD 8) which requires LINK to do all it can to fulfil its commitment to maintain the broad geographic spread of free-to-use (FTU) ATMs. 

SD 8 was due to end on 2 January 2022. However, the extended SD 8a, will remain in place until the end of March 2022, or until it is varied or revoked.

In October 2021, the PSR consulted on the issue of a new Specific Direction to replace SD 8 and received feedback which the regulator is reviewing. As a result, the PSR is keen to fully consider this feedback before deciding whether to issue a new Specific Direction to replace the extended SD 8a.

The PSR expects LINK to continue to comply with the terms and conditions set out in SD 8a.


New Specific Direction on maintaining free-to-use ATMs

The PSR’s consultation CP21/9 on a draft version of its proposed new direction on maintaining free-to-use ATMsran from 27 October to 16 November 2021.

The PSR state that LINK has done a good job in supporting the broad geographic spread of FTU ATMs in the UK. The annual reviews of SD 8 by the PSR found LINK’s application of policies and measures to maintain the broad geographic spread of FTU ATMs to be generally effective.

The PSRs second SD 8 review highlighted a few areas where LINK could enhance the effectiveness of its policies. As such, they expect LINK to consider:

  • ways in which the resilience of its ATM replacement procedures could be enhanced
  • how it can improve the transparency of its Direct Commissioning process.

The draft Specific Direction requires the operator of LINK to continue to have in place and maintain appropriate policies and measures so that the broad geographic spread of the FTU ATM Network can be maintained – this includes a defined radius which is currently set at 1km. The defined radius is used to define a protected ATM (an FTU ATM which has no other FTU ATM within the defined radius).

The draft proposed Specific Direction also requires:

  • LINK’s policies and measures to meet certain objectives – this includes requesting LINK to set out the criteria it will use to determine the circumstances in which alternative cash access will be considered as an adequate substitute for a Lost ATM.
  • Fewer monitoring and reporting requirements.
  • LINK to provide the PSR with one months’ notice if it proposes to vary, revoke or replace any of its procedures, policies processes and measures, including the defined radius which is current set at 1km. LINK cannot bring any of its proposed changes into effect if we raise objections within the one-month notice period.

As a result of the consultation on the issue of a new Specific Direction to replace SD 8a the PSR received feedback which it is reviewing. As a result, the PSR is keen to fully consider this feedback before deciding whether to issue a new Specific Direction.


Access to cash

The adoption of appropriate policies and measures and reporting obligations regarding protected ATMs by LINK is part of a larger regulatory focus on access to cash. The PSR has been progressing a wide range of activity to meet its stated objective to support access to cash for UK consumers who need it.

A summary of the PSR’s work to date on access to cash (together with links to PSR reference material can be found here: Access to cash.


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