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$5 ATM Fees May Very Soon Be A Reality
By
Ben Yakas
Published Mar 17, 2011
Modified Mar 17, 2011
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By
Ben Yakas
Published Mar 17, 2011
Modified Mar 17, 2011
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We've heard plenty of stories about people using ATMs to skim money from unsuspecting customers, but it seems that banks have been taking note, and have decided to get in on the action: several banks are rolling out dastardly new charges that could increase ATM fees to $5!
These fees are big business for banks: ATMs generated $7.1 billion in profits from them last year, according to consulting firm Oliver Wyman. According to the WSJ, the new fees are due to changes in federal regulations on overdraft charges and debit cards—banks are scrambling to replace billions of dollars in revenue expected to be lost any way they can. J.P. Morgan Chase & Co., TD Bank Financial Group, and PNC Financial Services Group have already started testing out the increased fees in other states; it now costs $5 in Illinois and $4 in Texas for people who use a Chase ATM and aren’t a bank customer.
"If you have to find revenue somewhere, increasing this surcharge [on noncustomers] is the least unpleasant way of doing it," said Tony Hayes, a partner in the banking practice of Oliver Wyman. And more increases are expected to come: some banks are increasing charges for checking accounts, and TD Bank recently dropped its policy of letting its customers use other ATMs for free, and now charges $2 a pop. Some are comparing these changes to the airline industry, "which is building its business on fees for checked bags, peanuts and other little “perks” the public used to take for granted."
Last year, Mayor Bloomberg postponed signing a bill to stiffen fines for illegal sidewalk ATMs because he didn't want to be a Grinch; but if these fees come to be in NYC, customers will likely balk at the charges, and Bloomberg may not have to worry about ruining anyone's Christmas this year.
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banks
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Ben Yakas
Ben Yakas is a former Gothamist reporter.
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Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
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