Cash withdrawals from ATMs deployed in 15 central and eastern European countries grew at a much slower overall rate in 2009 than during the three previous years, and the reasons behind the drop are difficult to explain, researchers concede in a report issued May 10 by Retail Banking Research, a London-based strategic marketing firm.
Consumers last year made 4.28 billion cash withdrawals from the regions’ 169,003 ATMs, up 2.9% from 4.16 billion made from 152,905 machines in 2008, Andrei Charniauski, a Retail Banking Research associate, tells PaymentsSource. Last year was the first in a decade the annual growth rate in ATM withdrawals fell below 15%, Charniauski writes in his report “ATMs and Cash Dispensers–Central and Eastern Europe 2010.”
In 2008, cardholders initiated 4.16 billion cash withdrawals, up 16.9% from 3.56 billion in 2007, when withdrawals grew by 19.9% from 2.97 billion the previous year, according to Retail Banking Research. Charniauski attributed the previous years’ growth rates to more banks distributing payroll debit cards as paper check replacements and to deploying ATMs on plant and office grounds to encourage ATM use.
“I don’t have a clear explanation for the decline” in the growth rate last year, says Charniauski, noting four of central and eastern Europe’s markets reported increases in ATM withdrawals–Kazakhstan, Romania and Poland and Russia. Financial institutions in Russia, Europe’s largest ATM market, reported 1.76 billion ATM cash withdrawals, up 10% from 1.6 billion in 2008.
However, in Ukraine, central and eastern Europe’s second-largest ATM market, cash withdrawals declined by 12%, to 513 million from 583 million. In 2008, banks closed unused debit card accounts, Charniauski says. Consumers also closed accounts to avoid paying the banks’ monthly $5 fee.
“In the United Kingdom that is not very much money,” Charniauski says. “But in the Ukraine, where the average salary is $300 per month, it is a lot.”