Out-of-network ATM fees, overdraft charges hit record, new survey says

October 06 00:26 2015

It’s costing consumers more and more to get ahold of their own money. The average fee consumers pay to withdraw cash from an ATM outside their bank’s network is a record $4.52 per transaction, according to a new survey. That amount is  a combination of two fees, rather than one, which may come as a surprise to some consumers.

“Your bank the majority of the time is going to charge you,”  says Greg McBride, chief financial analyst for Bankrate.com, “and almost without fail the ATM owner is (also) going to charge.” You’ll likely pay more in Atlanta, where out-of-network transactions average $5.15, and a lot less in San Francisco, where the typical fee is $3.85, the survey found. Fees for using an out-of-network ATM have increased 21% over the past five years, in part because more customers are seeking out their own bank’s ATMs in order to sidestep those extra charges. Those fees help maintain a bank’s infrastructure, discourage consumers from doing transactions with financial institutions that are not their own, and at times may pump up a bank’s profit stream.

“There is clearly some profiteering in there,” McBride says of why banks charge their own customers for going outside the institution’s network. “And it’s also by design to get the customer to use the bank’s own ATM.” Meanwhile, the ATM owner’s surcharge helps pay for the bank’s operations. “ATMs are available to the bank’s own customers for free, so the cost of maintaining that network is borne by non-customers making out-of-network transactions,” he says. “Nobody’s worried about alienating a non-customer.’’

Even if you stick with your own bank, you’re likely to encounter record high fees for overdrawing your account, with overdraft charges averaging $33.07, up 9% since 2010, according to the survey of 10 banks and thrifts in each of 25 large U.S. markets between July 9 and Aug. 5. But there are ways to make sure you don’t go broke trying to access your own money.