ATMs-The No-Arm Bandits

April 11, 2008
Special Feature

When automated teller machines were introduced, banks billed them as cost-saving machines. Bank customers who expected to see some of those savings have been sorely disappointed, however. Last year, Bank of America raised it ATM fee for non-customers to $3,

$20Amount of the most common withdrawal from an ATM.(AmericOne, 2008)

When automated teller machines were introduced, banks billed them as cost-saving machines. Bank customers who expected to see some of those savings have been sorely disappointed, however. Last year, Bank of America raised it ATM fee for non-customers to $3, the highest in the country.

Unwary consumers who use a Bank of America ATM also get charged a fee by their own bank, raising the cost of the transaction even higher. It gets worse—many banks have introduced an annual ATM card fee, which you pay even if you never use an ATM.

Some banking experts estimate that using another bank’s ATM is costing Americans upwards of $4 billion a year. Add in the charges that the customer’s own bank levies on “foreign” withdrawals and ATM fees become an $8 billion cash cow for banks. That’s great for the banks; as the mortgage market implodes, they are relying more on increased ATM fees to shore up the bottom line. As yet, there’s no limit imposed by regulators on these fees and the income from them is steady.

Tip: One way to avoid ATM fees when you’re traveling is to use your ATM card at retail outlets and get cash back.

“In God we trust, all others pays cash.”—Jean Shepherd