Withdrawing money an ATM not owned by your bank has never been cheap. But now, ATM providers have new way to make sure they maximize the fees you pay for withdrawals.
From Felix Salmon of Reuters:
Paul Volcker likes to say that the only worthwhile financial innovation of the past 20 years has been the ATM. So I suppose it was only a matter of time before that, too, was rendered evil.
Here, courtesy of Peter Eavis, is how the ATM at the Holiday Inn in Orlando now works -- it doesn't just charge $3 per withdrawal, but rather the higher of $3 or 3%.
ATM fees have been climbing steadily ever since Bankrate first surveyed them in 1998, when the average out-of-network withdrawal would cost you 89 cents. The rate of increase has been, at least in recent years, about in line with inflation.
But if it gains widespread traction, this method of figuring ATM fees will amount to a gigantic fee increase for anyone withdrawing more than about $100. For many ATMs, a common cash withdrawal limit is $400; to make that withdrawal under the above terms would cost you $12. And that's not including whatever your own bank charges you for an out-of-network withdrawal.
What do you think? Is charging a percentage of large withdrawals reasonable? Would it discourage you from taking cash out?
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