Dueling With ATMs

The best things in life aren’t fees when it comes to pulling cash out of a machine.

utomated teller machine fees infuriate owner-operator Reginald Donnelly. “I used one today, and it cost me $2.95 to get my money,” says Donnelly, who is leased to Landstar Ranger. “I’d like to be the guy who gets those fees. I would stop driving a truck.”

Many truckers share the Mullins, S.C., resident’s feelings, such as the customer who circled the $2.95 surcharge announcement posted on top of one Alabama truck stop ATM machine and scrawled “rip off” on the posting. Then there are consumer groups, as well as state and federal lawmakers, whose efforts to limit ATM fees have failed largely because of bank lobbying, according to the Public Interest Research Group.

The Americans Bankers Association says in its members’ defense that the advent of ATM surcharges in 1996 allowed the number of ATMs to nearly double to 352,000 locations and helped pay for installations in more remote areas.

That’s little consolation to cash-strapped owner-operators who get charged high ATM fees when they’re away from home, but there is more to do about those fees than complain. Before you consider your options to minimize cash-related expenses, make sure you know how much your on-the-road cash fixes actually cost.

When you use an ATM not owned by your bank or credit union (or affiliated network), you pay a “foreign ATM” fee to your bank, which averages $1.14, according to a Federal Reserve survey of bank fees based on 2002 data. But that’s not all. In many truck stops, the ATM is owned by a financial institution that charges the customer a transaction fee or a surcharge.

A survey of four large truck stop chains found surcharges ranging from $2 to $2.95. That means if you use an ATM not owned by your bank and are subject to the top rates, it could cost more than $4 per transaction, counting the foreign-use fee and the surcharge. Even at a modest $1.14 foreign fee plus a $2.50 surcharge, making one weekly withdrawal will cost $190 a year. Your real cost is slightly higher if your bank is among the 10 percent of financial institutions that charge an average annual fee of $12 simply for the privilege of having an ATM card, according to the Federal Reserve report.

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Surcharges in the $2 to $3 range are on the high end of the scale. In New York, for example, a Public Interest Research Group survey of Empire State banks this year found ATM owners charged an average surcharge of $1.55 to users unless the customer had an account with the financial institution or network that owned the ATM. The average foreign-use fee charged to the user’s financial institution was $1.28.

Longtime owner-operator Charles Franklin estimates he has used his ATM card twice in recent years, and only at his hometown Nashville, Tenn., bank. Franklin, leased to Baltimore-based Cowan Systems, says he stocks his cab’s refrigerator with food and gets enough cash from his bank before he leaves Nashville. He says a Comdata card offered by his carrier also helps him cover expenses.

Jon Hartley of Lafayette, Minn., says he used to pay ATM fees a year ago when he was an owner-operator driving West Coast and Midwest states. He minimized his cash needs and ATM fees by using his debit card at large grocery chains, such as Albertsons.

Now that he is home nightly as a company driver for Minnesota-based Wayne Transport, Hartley sticks to his bank’s ATMs to avoid fees. In 2002, only 3 percent of banks charged their customers for each use of their own banks’ ATMs.

Some retail chains, such as Wawa, offer surcharge-free ATMs. That service is a good fit for truckers because the convenience store chain also offers diesel at its 540-plus facilities in Pennsylvania, New Jersey, Delaware, Maryland and Virginia.

On a larger scale, there are surcharge-free networks of financial institutions. CO-OP Network, for example, gives the network’s credit union customers surcharge-free access to money at its 17,772 ATMs nationwide.

Also, many online banks and brokerage firms offer surcharge-free ATM access. If you’re not familiar with the bank, check with the Federal Deposit Insurance Corp. to see if it is federally insured before opening an account.

Some users of ATM cards, which also work for debit purchases, are being hit by yet another fee, says Susan Craine, New York Public Interest Research Group spokeswoman. Some financial institutions now impose a fee when their customers complete a debit transaction via their ATM personal identification number, which is more costly to the customer’s bank than a transaction based on the customer’s signature. The Federal Reserve announced May 18 it will study point-of-sale debit card fees and requested public comment on whether institutions adequately inform customers of this fee.

Should you have any dispute over ATM fees or other problems, check the disclosure form that came with your ATM card. Keep ATM receipts until you check your monthly bank statement to see if you agree with your bank.

If you are thinking of switching financial institutions, look at the big picture, not just ATM fees. Consider what your biggest needs are, how efficiently a bank or credit union can meet those needs, and what your total cost of services will be before making a change.

Beat The Fees
The Internet consumer finance website Bankrate.com offers these tips for getting around ATM fees:

  • Use ATMs owned by your financial institution because in most cases customers of the institution won’t be charged. Find a bank that has ATMs convenient for your use.
  • Many Internet banks don’t charge their customers for using another bank’s ATM, but you’ll still have to pay the other bank’s surcharge. However, many online banks reimburse for a certain amount of these charges.
  • Try to take out enough money from your paycheck or checking account to cover your needs on the road.
  • Get cash back at large chain stores that offer this free option when using your ATM card as a debit card.
  • If you’re using a large financial institution and are unhappy with the fees or service, check out smaller banks and credit unions, which tend to offer better ATM deals.

Here are some of the financial networks offering ATM use free or at reduced cost:

Alliance One is a group of 1,063 credit unions, community banks and thrifts that allows cardholders to access each other’s 3,135 ATMs in most states without paying foreign ATM fees.

CO-OP Network gives surcharge-free access to thousands of ATMs to customers of credit unions participating in the CO-OP Network.

A Chicago law professor maintains this site, which includes directories of surcharge-free ATMs and related information.

NetBank is a virtual bank that offers an ATM network expected to total 5,300 locations this year and does not charge its customers for using it. However, the ATM owners can charge fees for use, so the bank provides links to sites that list free ATMs so that customers can bypass these fees.
–Jill Dunn

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