There’s arguably nothing worse than paying an ATM fee. You might ask why anyone would go to an out-of-network ATM, but emergencies occur and your bank may not be nearby.
If you’ve had to use an out-of-network ATM recently you’re probably aware of the soaring fees. A recent study from Bankrate.com concluded that the national average ATM fee is now at $4.52.
Keep in mind that’s the national average in other areas it’s even higher. According to Bankrate’s data the fee for using an out-of-network ATM is over $5.
Why do bank’s charge out-of-network and ATM fees anyhow?
Your bank says it’s the cost of maintaining ATMs. What actually goes into maintaining an ATM? U.S. News & Money asked John Oxford, director of corporate communication and external affairs at Renesant Bank about the reasoning behind the increases and he put the blame on four things:
Maintenance and service
EMV chip compliance
“Many laws dictate how banks must operate. ATMs had to be upgraded in recent years to be compliant with the American Disabilities Act,” said Oxford. “ATMs have had to add skimmer detection and other items such as higher-quality cameras and lighting to make sure clients are and feel safe,” he said.
In addition to having to refill ATMs with cash, banks also have to pay a lease on the property where ATMs are located and insurance on the ATM itself.
You’ve probably already received a new checking card from your bank with an EMV chip. These embedded microchips provide a safer and better way to store cardholder information. According to Oxford, ATMs have to be ready to handle this upgrade which costs the banks money.
Smaller banks also have to pay to lease ATM machines themselves, which places additional financial burden on the institution.
Still, it’s difficult to feel sorry for the big banks when paying $5 to retrieve your hard earned cash. Fortunately consumers now have even more opportunities to avoid a visit to the ATM. Credit card and banking apps make it easier for you to transfer funds between your banking accounts and to others even if they bank with another institution.
How to avoid the fees?
To avoid transfer fees from your bank try using apps like Venmo, Paypal and Square Cash to send money. You can even send money through Facebook. If you have an iPhone you can even make purchases with your phone. Just make sure you’re not connected to a public wifi when you make an app transfer.
How do you feel about ATM fee increases? Will it change the way you bank?