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Checking Study: ATM fees keep climbing

See the most recent version of the checking study.

Fees don't end with those pertaining to checking accounts, of course.

ATM fees have been an equally expensive proposition for many account holders.

Here are the key findings on ATM fees:

Average fee to use another bank's ATM: The average fee a bank charges a customer for using another institution's ATM bounced to a new high, jumping from $1.29 to $1.35.

This comes after a two-year period where the average fee showed little change, fluctuating between $1.28 and $1.30.

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In the four years from 1998 to 2002, the average jumped nearly 19 percent, from $1.08 in fall 1998 to $1.28 in fall 2002. The most common fee assessed by banks continued to be $1.50, though the $2 fee is gaining in popularity.

In the latest study, 64 institutions charged a $2 fee, up from 53 institutions in the prior edition of the survey.

Average ATM surcharge: The average fee that ATM owners charge noncustomers increased from $1.37 to $1.40, a high-water mark reached only once before in fall 2003. The average surcharge has shown little movement in the past four years, compared to a rapid ascent between 1998 and 2000. The average surcharge has increased 40 percent in the past six years. The most common fee continues to be $1.50, with nearly half of banks that surcharge non-account holders assessing that fee.

Percent of institutions with ATMs that surcharge: Of the institutions surveyed that have ATMs, the percentage that assesses surcharges remained just below 91 percent. This ratio is lower than the levels sustained from fall 2000 through 2003, when the percentage of institutions with ATMs that surcharged was between 93 percent and 94 percent.

The decline in the past two years is due to institution changes and banks, such as Washington Mutual, offering surcharge-free ATMs nationwide. The current prevalence of surcharging is still sharply higher than the late 1990s. Six years ago, in the spring 1999 edition of the survey, 74 percent of the banks with ATMs that were surveyed assessed surcharges.

Annual cost estimate of non-bank ATM withdrawals -- in billions: Americans waste nearly $4 billion each year making ATM withdrawals at the "wrong" bank's ATM. derived the estimate of the total cost of non-bank ATM usage -- both surcharges and the fees charged by customers' own banks for withdrawals at non-bank ATMs.

This estimate is based upon the latest data for both ATM surcharges and fees assessed for using other banks' ATMs, and GAO data on the number of ATMs and non-customer transactions per ATM. The 2005 annual cost estimate of non-bank ATM withdrawals comes to $3.993 billion. Deriving an estimate for prior periods reveals this as a new high, though the estimate would have ranged between $3.4 billion and $3.9 billion over the past five years.

However, the current estimate is still 44 percent higher than the spring 1999 estimate of $2.77 billion. ATM fees -- both surcharges and the non-bank ATM withdrawal fee -- still exact a significant penalty for using a non-bank ATM, especially for small withdrawals.


-- Posted: May 11, 2005




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