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Consumers losing the fight against ATM surcharges

See the most recent version of the checking study.

Checking studyATMs are not just a convenience; they're a necessity for someone whose free checking account depends on using ATMs instead of tellers.

But if you use an ATM that isn't owned by your financial institution, you'll get hit hard with surcharges and, possibly, other fees. It's important to carefully plan withdrawals for times when you can access your own bank's ATMs.

Get used to it. Consumers are losing the battle against ATM surcharges.

Iowa, the only state that banned surcharges by state-chartered banks, gave up the good fight this month. The state superintendent of banking rescinded the ban after five national banks sued and won.

Here are the results of the Spring 2002 Checking Account Pricing Study when it comes to ATMs:

Surging surcharges
The average surcharge for using an ATM that isn't one of your bank's is at an all-time high, $1.47.

That's up 2 percent from a year ago.

The most common surcharge is $1.50, but more institutions than ever before are charging $2.

Percentage of institutions surcharging
Ninety-nine percent of the institutions surveyed offer ATM cards, and 90 percent of them assess surcharges. Compare that to 69 percent surcharging just three years ago.

Total cost of surcharging
Plenty of consumers get caught short of cash when they're not near one of their bank's ATMs. Using General Accounting Office data on the number of ATMs and non-bank ATM transactions, Bankrate.com estimates that consumers will pay more than $2.2 billion this year in ATM surcharges. That's up 18 percent from the 1999 estimate of $1.91 billion.

Another fee to use a non-bank ATM
It's not just the other bank that will charge you for using its ATM; your own financial institution probably will also zap you with a fee. That fee, on average, is $1.38, up 2 cents from October. Eighty-eight percent of institutions charge their customers for using non-bank ATMs. The most common charge is $1.50.

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No charge for cash back at the register
A great way to get around the fees associated with using a non-bank ATM is to use your ATM card when you go to the supermarket and ask for cash back.

Eighty-five percent of institutions don't charge for using an ATM card at so-called point-of-sale cash registers.

That's up from 77 percent three years ago.

Fees for having an ATM card
Some banks charge customers a monthly or annual fee just for having or using an ATM card. Fortunately, they're few and far between; just 9 percent of institutions surveyed. That number has been pretty consistent since October 1999.

The most common fee is $12 per year; usually billed as $1 per month.

Debit cards
Debit cards continue to be a popular offering, with 95 percent of institutions surveyed having them. That's up 1 percent from last fall. More than three-quarters of the institutions surveyed price debit cards and ATM cards the same.

-- Posted: March 28, 2002

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See Also
Bankrate's Spring 2002 Checking Study
MAIN: Checking fees going down
Know your checking style
ATM surcharges keep soaring
Internet banks still a better bet?
Key highlights of the study
CHARTS: Find the best checking account for you


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