In a letter responding to the suggestion, Abbey, which uses red in its branding and logo, said the proposal was 'a direct clash with the Abbey brand and would create a confusing message'.
The bank took on the red corporate branding of parent company Banco Santander in February 2005 following its takeover by the Spanish bank in November 2004.
Nationwide said it was disappointed with Abbey's response. It has been spearheading the campaign alongside Halifax Royal Bank of Scotland for ATMs to use a red and green traffic-light system. In 2005, the two banks unveiled plans to display green stickers on their ATMs to highlight that cash withdrawals were free, following an increase in the number of ATMs that charge (Marketing, 5 October 2005).
Nationwide's executive director, Stuart Bernau, said: 'While we cannot seriously believe that Abbey consumers would be confused by red or green signs, we are open to any alternative suggestions.'
Of the 56,000 cash machines in the UK, about 23,000 charge a flat rate fee of up to £1.50, according to the Citizens Advice Bureau.