Some places that at one time would only accept cash, such as pubs and markets, are now encouraging contactless card payments, while customers have formed new habits of visiting ATMs less often, it added.
Transactions nationally fell by seven per cent last year, with 1.5 billion withdrawals and balance inquiries made, down from just over 1.6 billion in 2020, Link’s figures revealed.
In the West Midlands, including the Black Country, Shropshire and Staffordshire, each individual withdrew an average of £2,191 from cash machines in 2019, before the pandemic.
But that figure falls dramatically after coronavirus arrives, with £1,612 withdrawn on average in 2020 and £1,523 in 2021. In Wales, £2,005 was taken from ATM’s on average in 2019, dropping to £1,407 in 2020 and £1,349 last year.
In total, UK banking customers withdrew £79 billion from cash machines, down from £81 billion in 2020.
The average person aged over 16 visited a cash machine 18 times last year. The UK average for withdrawals last year was £1,462.
The fall in the number of cash machine withdrawals in 2021 was less severe than a 40 per cent decline in the number of withdrawals in 2020 compared with 2019, amid lockdowns and other coronavirus-related restrictions.
Even before the coronavirus pandemic, ATM transactions were typically declining 10 per cent year-on-year, Link said, as people used other ways to pay, such as contactless cards.
Graham Mott, director of strategy at Link, said: “In the second half of last year the numbers were similar to what we saw in 2020.
“This is beginning to feel like the new normal and we don’t expect the number of transactions, or the amounts withdrawn, to return to anything like pre-pandemic levels.
“In fact, what we’re generally seeing is that consumers that are using ATMs have formed a new habit of visiting less often but withdrawing more cash each time they visit, typically £10 to £15 more.”
He continued: “Anecdotally, locations such as markets or even pubs that pre-pandemic only accepted cash, now all have card readers and continue to actively encourage contactless payments.
“Therefore, some consumers who are confident using digital or contactless payments, now use cash less often than they did pre-pandemic and seem unlikely to ever revert back.
“However, we know that there are still more than five million people who rely on cash and digital payments are not an option.”
Link said it is committed to protecting cash access. The Government has previously said it will legislate to protect the future of cash.
Link’s figures show there were 52,547 ATMs in December 2021, of which 40,856 were free to use.
In December 2019, before UK lockdown restrictions, there were 59,610 ATMs, of which 44,870 were free to use. In December 2020, there were 40,608 free to use ATMs - a figure which is lower than in December 2021.
Northern Ireland remained the most “cash heavy” part of the UK last year, with customers withdrawing an average of £2,070 in 2021. People in the South West withdrew the least, with £1,023 on average.