Upping the Ante at the ATM

Would you spend $8 for the convenience to grab cash on the go? With ATM fees on the rise you might have to if you can’t find a bank in your network close to your new job, your home or wherever you might be when you need pocket money. In Illinois Chase (JP Morgan Chase) banks are testing a $5 surcharge for non-customer transactions and your bank will typically tack on a $2-4 fee as well.

Chase spent approximately $400 million to build its network of 16,000 ATMS across the country. Annually it takes another $200 million to keep it running. Other institutions are in the same situation. In order to maintain the system and turn a profit banks are looking to cash in on non-member usage or persuade people to open new accounts. Even free or basic accounts may begin having fees applied to ATM usage unless they upgrade their account with monthly maintenance fees or keeping a high balance on hand.

"It's easy to compare debit cards by looking at the monthly fee, so banks are going to try to minimize the monthly fees and load you with fees in different ways -- and ATM fees are going to become one of the most popular ways to do that," CEO of Cardhub.com Odysseas Papadimitriou said.

He theorizes that because of limits on swipe fees banks and credit card companies are looking for ways to get the bucks back however they can. "They need to maintain a certain profitability for the services they provide, so they're going to get the money one way or another," he said. "They will be experimenting with a whole gamut of things, and ATM fees are just one way of getting the money back that the Durbin Amendment is taking away from them."

The Durbin amendment limits the swipe fees large companies charge small businesses to process credit card payments. Despite the fact that processing costs have decreased the fees to swipe credit cards quickly increased. In 2008 $48 billion dollars were charged in swipe fees from businesses across the country and 80% of that money was split between 10 large banks.

As prices rise everywhere it may not be possible to afford the conveniences previously presented for free. Big banks feel they are offering enough alternative options that ATMs are a luxury and the fees can be avoided by simply not using the service.

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By Heather Fairchild - Heather is a multimedia developer with experience in web, film, photography and animation as well as traditional fine arts like painting and sculpting. In addition to writing for FinancialJobBankBlog.com, she is co-founder of design and promotion company, Creative Kazoo with fellow Nexxt blogger, Staci Dennis. Heather’s spare time consists of making puppets, teaching Sunday School, building Legos and doing science experiments with her children.