Abbey National offers free cash withdrawals

Abbey National has announced it will not be charging customers or non-customers for using its network of more than 3,000 cash machines from 1 January 2001.

Like its rival mortgage bank, Halifax, it has also decided to scrap "disloyalty" fees on its customers who draw cash from other banks' machines. At the moment, it charges a £1.50 disloyalty fee.

Halifax announced a month ago that it would be scrapping the charges.

Abbey National's decision means that the owners of more than half the cash machines in Link, the UK network, have now pledged not to charge for cash withdrawals.

Double-charging

High street banks such as Barclays had led the move to introduce charges for non-customers, raising the possibility that some people could be charged twice for cash withdrawals.

Once by their own bank for using another bank's machine and then again by that bank for using the machine without being an account holder.

This caused such a furore that Trade Secretary Stephen Byers became involved and in March the 34 members of Link agreed unanimously not to allow double-charging.

It was left to them to decide whether they wanted to surcharge non-customers for using their cash machines, although Mr Byers made it clear he wanted to see the banks provide customers with good, competitive services.

Clear warnings

In its announcement, Abbey National noted that other banks may charge its customers for using their cash machines next year.

But under the terms agreed in March those banks should give a warning that such a charge is being levied before the transaction takes place.

The building society, Nationwide, has campaigned against the charges and threatened legal action against Barclays when it proposed imposing a £1 fee last year.

As well as Nationwide, Halifax and Abbey National, other financial groups which have pledged to scrap charges from 1 January include Yorkshire Building Society, Co-operative Bank and Tesco Personal Finance.