British consumers use cash machines more than any other people in Europe, making a staggering 2.7 billion withdrawals in 2005.

According to figures from APACS, the UK payments association, the number of cash machines in the UK doubled between 1999 and 2005 to 58,206.

Despite a massive increase in the number of fee charging machines, 97 per cent of withdrawals by cash value and 95.5 per cent of the number of withdrawals were made from fee-free machines.

Sandra Quinn of APACS, said: "The fact is we get an exceptional level of service in the UK. Not only do we expect cash for free from our own bank’s cash machines - which isn’t always the case elsewhere in the world - but we get to use their competitors' machines for free as well."

However, the explosion in the number of fee charging cash machines has resulted in people using a smaller pool of ATMs.

This has, in part, contributed to an even larger associated rise in cash machine fraud. Indeed, while the number of cash machines doubled between 1999 and 2005 the number of cases of ATM fraud grew by an even larger margin of 260 per cent.

In value terms cash machine fraud cost some £21.4 million in the first quarter of 2006, a 54 per cent increase on the previous year.

The majority of these cases are the result of skimming, where the fraudster attaches a small electronic device to the card entry point to record card details.

Counterfeit cards are then produced, allowing the criminal to withdraw money from cash machines.

But with more consumers using fewer free cash machines, it is feared that ATMs with skimming devices installed are capturing details from a growing number of people.

As a result a number of banks are increasing their investment in cash machine security. Sainsbury's has announced it is spending an additional £3.5 million on CCTV and anti-skimming devices, while Tesco has said it will spend £3 million on a similar venture.

However, as a result of last year's introduction of Chip and Pin technology some industry experts have predicted that in the longer-term the number of cases of skimming would decline.

A spokesman at Bank of Scotland said: "What makes skimming possible is the ease with which it is possible to copy the magnetic strips on the back of customers’ cards. It is currently possible to buy machines through the internet that allow skimming.

"But cards with magnetic strips are gradually being phased out and we expect that the growing use of chip-only cards will ensure that copying chips is not possible, because they are encrypted."

But even though plastic is rapidly replacing cash as the favoured means of payment for many consumers, Britons patronage of cash machines, and the fraud that sometimes results, is not likely to end any time soon.