HSBC has made a deal with the Federation of National Retail Newsagents regarding rolling out numerous free ATMs in convenience stores all across the UK. This is in association with hardware provider VocaLink. At present, the bank has a comprehensive network of 3,500 ATMs in the UK. The bank has decided to grow the number by at least 500 in 2008. Some of these ATMs are planned for grocery stores, newsagents and off-licenses. HSBC intends to concentrate on isolated areas that are not too well served by local ATM estate. The customers will be able to withdraw cash as well as deposit money and pay their bills.

HSBC is taking this initiative with the intention of reaching out to the customers who are not located near any branch. Almost 98 per cent of cash withdrawals occur via the ATMs. If HSBC customers used ATMs of other banks then the banks charge an interchange fee on each other. Thus any bank, which has more number of ATMs than its rivals, will definitely get an interchange dividend.   So this is a crucial decision taken by HSBC. However individual deployments will also depend on the fact whether shopkeepers want their existing fee-charging ATM replaced by a free one.