Bank Regulation

Link, ATM Operator Face Potential Court Fight

NoteMachine, one of the biggest ATM operators in the U.K., is threatening to sue Link, the U.K. body that oversees the network of cash machines in the country.

According to a report in The Financial Times, NoteMachine contends Link ran afoul of competition rules by making changes to its payment system. According to the report, Link’s original proposal would reduce interchange fees by 20 percent from 2018 through 2021. But Link decided to cancel the third reduction and will review the fourth one after facing pressure from politicians, lobbyists, and regulators.  The fight escalated when Link told members that one member has claimed the changes infringe on the Competition Act.  In an interview with The Financial Times, NoteMachine said it was the Link member that Link referenced.

“We really do feel [Link] have got to do something about reversing these [measures] that have been brought about simply by competitive threats — there’s too much consumer detriment and it isn’t proper behavior,” said Peter McNamara, chief executive of NoteMachine, in the report. NoteMachine thinks the new levels were made arbitrarily and were put in place due to pressure from large banks that threatened to leave the Link network. A Link spokesman declined to comment on the fight with NoteMachine, but Link chief operating officer Sue Wallace wrote in an email seen by The Financial Times that the company “strongly” rejects the contention.  “It is hoped that Link’s response to the allegations will deal with the member’s concerns. However, should this prove not to be possible, we will strenuously defend any possible further action,” the email stated, according to the FT.

Cardtronics, which is a rival of NoteMachine, is not involved in the legal fight — but it also objected to the interchange cuts and is in discussions with regulators about alternative proposals. The report noted that the number of free to use ATMs in the Link networked declined 5 percent last year, marking the first annual dip since 1998.



New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.