Cash machine users face the threat of new fees to withdraw money at thousands of ATMs amid an industry row over service costs.

Proposals by Link, the company which runs a network of 70,000 UK cash machines, to review the way it runs the ATMs has prompted a warning from one operator that it could trigger a new customer fee at many of the 53,000 cash machines which are currently free to use.

The dispute is largely between the high street banks that provide free ATMs nationwide and rival independent operators that offer paid-for and free cash machines, often in rural or remote locations.

Under Link's current business model, when you withdraw money from a machine not run by your own bank or check your balance, your bank has to pay an 'interchange fee' – up to 25p – to whoever owns it.

This is costing banks – which have millions of customers who make regular withdrawals – upwards of £1 billion a year, sources suggest, which has sparked the call to cut costs.

However, lower interchange fees between banks would also hit the profits of independent ATM operators.

Peter McNamara, CEO of Link member firm and ATM operator NoteMachine, warned in a radio interview yesterday that "if the proposals [to cut operators' fees] that are being put forward went ahead we estimate that you could be losing up to a quarter of free-to-use ATM sites in the UK".

There's no indication yet as to how much customers might be charged for accessing their cash if operators do decide to bring in fees, but the average fee at pay-to-use ATMs is currently £1.70.

Link's 39 members – which include banks, building societies and independent operators – are set to meet next week in a bid to reach an agreement on the issue.

What does Link say?

A spokesperson for Link says: "[Our] commercial model is under review. The contractual discussions are complex by nature, with many interested parties, and while they are unlikely to be resolved in the coming days, Link will be working hard to resolve this in the next couple of months.

'In the meantime it remains business as usual at the 70,000 UK cash machines which are part of the Link network. If any changes occur as a result of these discussions they would not happen overnight and we will make sure customers are kept informed."