ATM Fees at Record High for Out-of-Network Transactions
Most of us have been in a pinch somewhere in which we needed to get some cash to pay for goods or services and had to use an ATM that was not from our banking network, a situation in which the fees were staggering. According to a report released on Monday from Bankrate.com, ATM transaction fees for out-of-network withdrawals is now up to an average of $4.52, up 4% from 2014 and 21% from 2010. This fee is the combination of both the fee by the user’s bank and the fee charged by the ATM operator. Bankrate’s CFA, Greg McBride, told Huffington Post that “In all likelihood these fees are going to continue to go up.”
On the high end, ATM users in Atlanta can expect an average fee of $5.15 per transaction, and on the low end, users in San Francisco can expect an average fee of $3.85.
Bankrate’s survey combined 243 banks in 25 large markets over the course of two months. McBride stated that this is the ninth year in a row in which ATM fees have increased. People have improved at avoiding out-of-network ATMs, this has improved with the rise of better banking apps which help users track down fee-free ATMs nearby. This has also increased because banks feel comfortable about raising fees without the fear of alienating non-customers.
Banks are restricted in the amount they can charge retailers for “swipe fees” so they have to make up for the lost revenue elsewhere by raising the cost of owning a checking account and raising ATM fees where possible. Because out-of-network transactions affect only non-customers, banks lose little business by raising these fees. Bankrate’s survey found that only 37% of non-interest checking accounts are completely free to use, this number is down heavily from 76% in 2009. When revenues are restricted in certain areas, banks have to find other ways to make up for it.
This issue is even worse for people living in low-income and underbanked areas with much fewer ATMs and network options. The lesson from this? Only use ATMs in your network unless it is completely avoidable and look for free checking options when possible. With the rise of ATM and other banking fees, Bitcoin’s low transaction fee and constant access to user funds is even more appealing.
What do you think about ATM fees? Let us know in the comments below!
Images via Pixabay.