MPs warn of danger to cash as ATM withdrawals plummet

"You can take the horse to the river, but you can't force the horse to drink water from the river"

The atm netwoek cost is to a large extent fixed while the revenue side is per trx. So if the transaction number goes down the atm owner suffers even if the interchage fee paid by the card issuer goes up unless the fee raise ecens out the drop of transaction numbers. Why should atm:s be free of use with under the table multilateral interchange fees? This set-up damages the business of the pay-for -use atm business and the competition office should stop this illegal multilateral interchange fee ring. This has been exactly the merchant argument against point of sale card payment interchange fees that merchants claim hikes the cost of goods sold. Court cases still pending against the card schemes. Now merchants seem to be in favour of the multilateral atm fees and even to increase them? When is the "free-atm scheme" taken to court? 

The cold hard reality is that cash was already dying slowly - the COVID-19 pandemic has accelerated its demise in western economics.

The future is both cash-less and card-less - within the next twenty years (nearly) everything will migrate to digital delivery - enabling quicker and easier ways to empower payments, loyalty and general banking.

Trusted Execution Environments in mobile and edge devices will enable this evolutionary leap to ensure security is maintained from a consumer-device perspective.

It is ironical that the world is faced with the prospect of vanishing ATM machines because no one wants cash. And cash withdrawal may become more costly because the networks are losing money.

The underbanked and marginalized are the ones who are more dependent on cash compared to others and they would get impacted even more as less cash availability and less cash acceptance (in store) becomes a whirlpool that sucks them in.

Cash, it may seem finally, is not the King anymore.

I bet the major card schemes are rubbing their hands in glee as it makes the average consumer even more dependent on their plastic which to must consumers is free, but in reality is paid for by merchants. Perhaps consumers should be made aware of the true costs of payments and allow merchants to pass on those direct costs (not exagerated costs like some airlines have charged) to the consumer via surcharges. Only then might they fully appreciate the benefits.

But there's a huge cost of cash as well.

@Finextra. You're right, here is a huge cost to cash ....and given the fixed costs associated with accepting it, as cash acceptance declines, the overal cost of cash will increase, resulting in fewer merchants wanting to accept it and ultimately increasing our ependency on the major card schemes who can, and are, increasing their other (non interchange) fees significantly. See this Finextra article : https://www.finextra.com/pressarticle/82525/retailers-and-wholesalers-call-for-urgent-amendment-of-card-fees-regulation

Consumers are mostly unaware of these fees and more transparency is required so that they can see what the true costs are and the dependency they have on electronic means of payment . In addition, what would happen if there's a massive power cut and little cash in circulation?

"No Surcharge" rule has been repealed in many parts of the world. Probably in UK & EU, too. Merchants can levy Surcharge on Credit Card payments if he wants to. But Merchants tend to be greedy, they want to have their cake and eat it too. All along they'll complain about MDR / Merchant Fees. Then, when you tell them they can pass it on to Cardholders via Surcharge, they'll suddenly start worrying about loss of business and cost of handling cash. 

But Black Swan events have a way of changing consumer behavior and industry trends more strongly and certainly than wannabe disruptive competitors, so it is quite possible that cash usage will continue to decline rapidly going forward, just not because of digital payment alternatives.