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More banks add ATM fees
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June 19, 1998: 1:35 p.m. ET
Surcharges will continue to rise as long as people are willing to pay them
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NEW YORK - Memo to people who are fed up with paying fees at bank automated teller machines: It's getting worse. More banks are charging fees and the price is rising, according to a Bank Rate Monitor survey of banks in the nation's top metropolitan markets. Topping the list of fees are ATM surcharges -- fees charged to non-customers who use a bank's ATM.
More banks charging, and fees climbing
The number of banks who do not add surcharges dropped to 45 percent in March 1998 from 52 percent in October 1997. And the amount of the fees keeps getting higher.
The number of banks with a $1.50 surcharge jumped to 18.1 percent from 11 percent in the six month period. There were also slight increases in the number of banks charging $1.25 and $1.75. The most common surcharge remains $1, with more than one-quarter of all surcharging banks demanding this amount.
How high will it go?
How high will surcharges go? It's tough to say. "There has to be a point where people walk away and go somewhere else," said Mitch Stevens, senior engagement manager for First Manhattan Consulting Group. "What that point is, I don't know."
Experts say the number of independent ATM providers that have charged into the business in the past two years may be affecting the rise of bank ATM surcharges.
Not only have these independent companies staked out prime ATM space in retail areas, restaurants and airports, but they sock all ATM users with fees often two or three times higher than those a bank charges. Despite the high fees, plenty of people are using these ATMs. And banks are taking note.
Ultimately, people can expect ATM surcharges to continue to creep up.
"Consumers are continuing to use surcharging ATMs and banks see that," said Marty Molloy, a research analyst at Mentis Corporation, based in Durham, N.C. "As long as the transaction volume stays up and consumers use surcharging ATMs, banks are going to leave the surcharging in."
Complaints more common than action
Molloy said more consumers complain about surcharges than actually do anything about it. "There is a group that's accepted it and while they're complaining about it, they're not really changing their ATM usage pattern," Molloy said.
Surcharges are not the only ATM fees on the rise. The number of banks charging their own bank customers access fees to ATMs continues to inch up. Nine percent of banks surveyed levied these charges in March, a jump from 5 percent in October 1997 and 2 percent a year ago. The most common charge is 25 cents.
Banks have also upped the fee when a bank customer uses a non-bank ATM from regional or national ATM networks like Cirrus, Plus and Mac. The number of banks charging $1.50 increased to 24.4 percent from 19 percent in October 1997. The most common fee is $1. 
-- by Bank Rate Monitor for CNNfn
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Bank Rate Monitor
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