New law to protect access to cash and oversight of ATMs is on track, says Department of Finance

A key element of the new legislation will be the oversight of ATM machines that aren’t operated by banks.

A retail banking review published late last year made a number of recommendations for the sector as lenders including Ulster Bank and KBC prepared to exit the Irish market.

Among the recommendations of the review was that the Department of Finance should prepare a heads of bill this year to require ATM operators to be authorised and supervised by the Central Bank.

Mr McGrath was asked this week by Green Party TD Neasa Hourigan regarding the oversight of independently-owned ATMs.

Independent operators control about 60pc of the ATMs in the country, said Mr McGrath in response to her written parliamentary question. Those operators are also known as Independent ATM Deployers (IADs).

He said that his officials are currently preparing the heads of bill and will bring it to Government before the end of the year and that approval will then be sought to draft the bill.

After that, it will be submitted for pre-legislative scrutiny to the Joint Oireachtas Committee on Finance, Public Expenditure and Reform, and the Taoiseach.

“In particular, in relation to IADs, the Department is closely working with the Central Bank of Ireland and the relevant industry players to determine the most appropriate means of authorising and supervising ATM operators,” said Mr McGrath. “This will be a key element of the access to cash legislation.”

The banking review’s publication also came just months after AIB, in which the State is the majority shareholder, was forced to backtrack on a decision to remove ATMs and scrap cash services at 70 branches.

While the Central Bank conceded last year that the use of cash in Ireland has slumped to about two-thirds of its pre-pandemic levels, it “remains an important means and choice of payment”.

The Department is closely working with the Central Bank of Ireland and the relevant industry players

However, despite the importance of cash to many consumers, businesses can still legally refuse cash payments as long as customers are notified in advance of attempting to make a purchase that cash will not be accepted.

That legal position is at odds with the Central Bank’s position that cash plays a vital role in ensuring the financial services needs of the vulnerable, those without bank accounts and those who are not digitally active, are met.

In late 2020, Bank of Ireland sold 700 non-branch ATMs to Euronet. Also that year, AIB sold a network of more than 500 non-branch ATMs to Brinks. In 2018, Ulster Bank sold cash machines it operated under the EasyCash brand in 400 stores in Ireland to Euronet.

The banking review also recommended last year that the Department of Finance hands the Central Bank the power to protect the resilience of the cash system in Ireland, including the authorisation and supervision of cash-in-transit firms.