THE First Minister has criticised the Royal Bank of Scotland’s moves to prevent free withdrawals from cash machines owned by its rivals.
Thousands of RBS customers will be affected by the cost-saving measure, which will see anyone with a basic RBS account restricted to ATMs owned by the bank.
Today, Alex Salmond urged Edinburgh-based RBS, which is 83 per cent owned by the taxpayer, to think again.
The First Minister said: “It’s always a retrograde step to have any policy that introduces a charge for some of your consumers who are at the lower end of the income scale.
“We see far too much of that, for instance with energy. I don’t think that should be introduced in the banking sector.”
The new rules were introduced for anyone signing up to a new type of “no frills” bank account, introduced at the beginning of July – but are now to be gradually extended to those with existing basic accounts.
Consumer groups have hit out at the decision and claim that those on lower incomes would be prohibited from using the vast majority of the UK’s ATM network.
The basic bank accounts are often used by some of the poorer customers as they do not require a credit check.
Dominic Lindley, principal policy adviser for Which?, said: “This change will increase financial exclusion as it leaves basic bank account holders at RBS unable to access around 80 per cent of the free cash machines in the UK.
“These account holders will be inconvenienced and might incur extra costs when travelling to find a cash machine.”
Lending expert at uSwitch.com, Michael Ossei, added: “This move is going to leave the most vulnerable customers stuck between a rock and a hard place.”
However, a spokesman for RBS claimed that it was financially “unsustainable” to continue paying flat charges to other institutions for transactions made by customers who do not pay fees.
He said: “It is unsustainable for us to offer access to other banks’ ATMs for basic account holders.
“We face a charge for every transaction and we have to recoup it elsewhere.”
The spokesman added that basic account customers would have access to 8000 RBS cash machines in the UK, through RBS, NatWest and Tesco – and would be able to make withdrawals at post office counters.
However, Lucy McTernan, chief executive of Citizens Advice Scotland, said: “The whole point of basic bank accounts is that they tend to be used by people who are financially vulnerable.
“They should be accessible and easy to use.”