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INTRODUCTION
ATMs save banks enormous amounts of money because there are no employees to pay and maintenance of an ATM is significantly less than that of a full-service branch. ATMs have become increasingly prevalent in New York State over the past decade and bank customers have adapted to the new world of banking and become accustomed to using their ATM cards. Banks (who own most ATMs) encourage consumers to use ATMs by urging that they are cost savers to consumers and banks.
However, savings or increased interest rates have failed to materialize for consumers. In fact, banks have actually made banking more expensive for their customers. Banks are: (1) increasing existing fees, (2) inventing new fees, and (3) making it more difficult for account holders to avoid fees.
Further, ATM fees are used by large banks with their extensive ATM networks to punish depositors and encourage them to leave smaller banks and credit unions. This anti-competitive strategy is contrary to the public's interest in seeing banks compete for market share through lower prices and better services.
This NYPIRG report addresses a range of ATM fees including the ATM surcharge - a fee assessed by ATM owners to non-accountholders. The statewide survey included in this report also documents foreign ATM fees, ATM card replacement fees and debit card point-of-sale fees.
ATM surcharges and other excessive ATM fees are unnecessary and unfair to consumers. This is particularly true because banks originally developed ATMs as a way to cut down on expensive teller transactions (1) . Indeed, ATMs are tremendous cost savers for banks. Each teller transaction costs a bank about $2.50, while each ATM transaction costs a bank 25¢ - 10% of the cost of a teller visit (2) . Simply put, ATMs offer banks savings over traditional teller transactions because there are no employees to pay.
In addition, maintenance of an ATM is significantly less than upkeep of a full-service branch. Banks save money when consumers use ATMs but have failed to pass that savings on to consumers. Instead, while customers are using ATMs in increasing numbers, they have been hit with increasingly high and creative ATM fees.
Recent technological advances may further reduce costs of maintaining an ATM. Web-enabling of ATMs - their retrofitting with Internet-based technologies - will make ATMs cheaper and faster for banks to add new services to the machines and to operate and maintain them (3).
•Almost all (97%) of the ATMs surveyed surcharge.
Six years after the national ATM networks dropped their bans on surcharging by member banks, 97% of the ATMs surveyed assess surcharges. Bank ATM owners surveyed that assess surcharges include Apple Bank, Bank of NY, Chase, Citibank, Dime Savings Bank of NY, Fleet Bank, HSBC, Key Bank and M&T Bank.
•The average fee assessed by the ATMs surveyed that surcharge is $1.49.
Most (76%) ATMs surveyed that surcharge assess a $1.50 fee. The average fee of the ATMs surveyed is $1.49 and the range is 50¢ to $2.50. All but one of the ATMs surveyed that surcharge assess a fee of $1.00 or more.
•The surcharge disclosures included advertisements on 42% of the ATMs surveyed that surcharge encouraging ATM users to become customers of the bank assessing the surcharge.
42% of the bank-owned ATMs surveyed that surcharge included advertisements encouraging ATM users to "switch their accounts to the bank that owns the ATM to avoid fees." The bank-owned ATMs that included advertisements in their surcharge disclosures include Citibank, Fleet Bank, HSBC and Key Bank.
• 88% of the banks surveyed assess a foreign ATM withdrawal fee.
88% of the banks surveyed assess foreign ATM withdrawal fees. Banks surveyed that assess foreign ATM withdrawal fees include Chase, Citibank, Dime Savings Bank of New York, Fleet Bank and HSBC.
•The average fee assessed by the banks surveyed that charge a foreign ATM withdrawal fee is $1.20.
Most (56%) banks surveyed that charge a foreign ATM withdrawal fee assess a $1.00 fee. The average foreign ATM withdrawal fee of the banks surveyed is $1.20 and the range is 75¢ to $2.00. 95% of the banks surveyed that charge a foreign ATM withdrawal fee assess a fee of $1.00 or more.
•65% of the banks surveyed assess a fee to check account information at a foreign ATM and the average amount of that fee is $1.03.
65% of the banks surveyed assess a fee to check account information at foreign ATMs. Banks surveyed that assess foreign ATM withdrawal fees include Chase, Citibank, Fleet, HSBC and Key Bank. Most banks surveyed that charge a fee to check account information at a foreign ATM assess a $1.00 fee. The average fee to check account information at a foreign ATM is $1.03 and the range is 50¢ to $2.00. 69% of the banks surveyed that charge a fee to check account information at a foreign ATM assess a fee of $1.00 or more.
•65% of the banks surveyed assess a fee to replace ATM cards if they are lost, stolen or ruined and the average amount of that fee is $5.75.
65% of the banks surveyed assess a fee to replace ATM cards. Banks surveyed that assess ATM card replacement fees include Dime Savings Bank of New York, Evergreen Bank, First Union Bank, Key Bank and North Fork Bank. Most (63%) banks surveyed that charge an ATM card replacement fee assess a $5.00 fee. The average ATM card replacement fee is $5.75 and the range is $1.00 to $10.00. 88% of the banks surveyed that charge a fee to replace ATM cards assess a fee of $5.00 or more.
•57% of the banks surveyed assess a point-of sale, debit card fee and the average amount of that fee is 89¢.
57% of the banks surveyed assess a fee to use ATM cards as debit cards to make purchases in stores. Banks surveyed that assess debit card, point-of-sale fees include Apple Bank, Charter One Bank, Dime Savings Bank of New York and Green Point Bank. Most banks surveyed that charge a debit card, point-of-sale fee assess a $1.00 fee. The average point-of-sale fee is 89¢ and the range is 25¢ to $1.50. 54% of the banks surveyed that charge a point-of-sale fee assess a fee of $1.00 or more.