Around 1 million customers of the Royal Bank of Scotland customers have been told they would no longer be able to use the cashpoint machines of other financial institutions.
The changes at the bank which is in part owned by the taxpayer would affect holders of its Basic Account, meant for people who cannot open a mainstream account, such as customers having no fixed address.
The move has invited a sharp rebuke from consumer watchdog Consumer Focus which has accused the bank of dealing a "kick in the teeth" to its "most vulnerable customers".
According to Marie Burton of Consumer Focus short-sighted moves like this would only help to reverse the good work done (to help people access bank accounts). She added that people living in rural areas deserted by bank branch closures may not have the option of other ATMs nearby.
Like other banks, RBS is charged for each use of its rival's ATM by its customers. According to an RBS spokesman it remained "fully committed to offering a free basic account for people who may otherwise struggle to access banking services".
He added basic account holders would still be able to use "one of the largest cash machine networks in the country".