ATM Fees and How to Avoid Them

If you’re like most consumers, you use an ATM a few times a month. ATMs, or Automated Teller Machines, make it easy to access your cash and bank accounts at any time and almost anywhere. While ATMs have become a useful tool for consumers, they’ve also added a large expense item to financial institutions. ATMs create a lot of cost through network participation fees, continuous updating of hardware and software, and coordination for cash fills and deposit pulls.

What does this mean to you? The financial institutions have to figure out a way to cover their costs and if you’re not paying attention, your choice of ATM may cost you. In fact, it’s now common to receive a fee from both the machine you’re utilizing and your bank if you do not have a relationship with the institution that owns the ATM. These two common fees are referred to as:

• Transaction Fees – Banks are charged a fee when their customers use ATMs that don’t belong to their bank. In turn, many banks pass that fee back to the customer. This fee is commonly $1-$3 per ATM transaction and it can be more or less depending on the financial institution.
• Surcharge Fees – The ATM owner gets to set the fees charged to consumers that use them. This includes the fee amount and who does/doesn’t get charged that fee. In most cases, if the ATM is owned by a financial institution, that financial institution won’t charge a fee to its own customers. A surcharge fee is commonly $3-$5 and will also vary depending on the ATM ownership.

How to Avoid ATM Fees

To avoid ATM fees, I encourage you to do the following:

• Ensure your bank has a large network of fee-free ATMs. At Bankers Trust, we offer 75,000 ATM locations that are free of both transaction and surcharge fees.
• Take some time to understand which ATMs near you won’t result in a fee when you use them. Financial institutions will typically offer an ATM locator on their website and mobile app so you can find these locations easily.
• Consider withdrawing cash when making purchases at your favorite retailers. Many retailers will allow you to withdraw money with no fee when you pay with a debit card and authenticate with a PIN.