Banks Waiving ATM fees

[GrannyMae]

<font color="green"> Large Banks Waive Fees for ATMs



By JENNIFER SARANOW
Staff Reporter of THE WALL STREET JOURNAL
November 2, 2004
It is getting easier to find a free ATM.

In a bid to attract new customers and retain old ones, big banks increasingly are waiving fees for customers who use other banks' automated teller machines, and at times, fees for other banks' customers who use their machines.

Starting this week, for example, Citigroup Inc.'s Citibank customers will be able to access free of charge the more than 8,250 ATMs in the nationwide MoneyPass ATM Network, operated by ATM processor Genpass Inc., Fort Washington, Pa. In March, Bank of New York Co. started offering a new checking account that is free of many charges for its life, including the perk of no fees for using a competitor's ATM, regardless of account balances.

The big banks dropping ATM fees are taking a cue from smaller banks. For nearly a decade, in hopes of keeping customers from switching to larger banks with more ATMs, many community banks have been teaming up and waiving withdrawal fees for each other's customers. Now it is big banks that are joining or building up ATM networks with few charges in an effort to lure new customers and keep old ones from switching to other banks.

By joining alliances and cutting fees, big banks aim to remain competitive and tout their own convenience. The MoneyPass network that Citibank is joining has ATM machines mainly located at merchants and banks. And big banks that process ATM transactions and issue debit cards for small banks also have started offering customers of those clients free access to their ATMs.

Some large banks are waiving ATM fees as they enter new markets. When Wachovia Corp. opens branches in Texas by the end of the year, customers who open new accounts there won't be charged for using non-Wachovia ATMs and will be credited $1.50 for fees charged by other banks, up to $5 a month. Wachovia started a similar policy in New York last year.

According to BankRate.com, the average surcharge was $1.32 last spring, down from $1.40 last fall.

The potential loss in revenue from dropping ATM fees isn't expected to be significant since banks now look upon ATMs more as marketing vehicles for attracting depositors rather than as revenue drivers. According to Dove Consulting Group Inc. of Boston, ATMs at bank branches collected an average of $1,054 in fees a month last year, down 17% from 2001. Meanwhile, ATMs in locations other than bank branches collected an average $952 a month in 2003, down 11% from two years ago.

The fee waivers from large banks come as recent acquisitions by a few banks are creating massive ATM networks. Citibank currently has about 2,900 ATMs nationwide and plans to add 150 in the first quarter from an acquisition in Texas. Since Bank of America Corp.'s acquisition of Fleet Bank closed April 1, customers have free access to about 16,500 ATMs in 29 states. And because J.P. Morgan Chase &amp; Co.'s acquisition of Bank One Corp. closed July 1, customers can use about 6,550 machines in 19 states for free. Both Bank of America and Chase say the acquisitions expanded their ATM coverage in spotty areas.

To be sure, some banks already don't charge ATM fees to customers, given they fulfill certain requirements. Chase, for example, doesn't charge customers with $35,000 in accounts for using nonbank ATMs. And some Citibank customers already aren't charged for using nonbank ATMs.

To find out where free ATMs are, consumers who know what alliances their banks participate in can search by Zip Code on bank and ATM alliance Web sites, look for logos on ATMs or ask their banks directly for fee information.

Fee waiving isn't always reciprocal among banks, either. Citibank, for example, doesn't allow customers of other banks who are members of the MoneyPass network free access to its machines. (To be a part of the network, members agree to pay a fee every time customers use a MoneyPass ATM.) And while Washington Mutual Inc. last year stopped charging noncustomers who use its ATMs, the bank still charges customers as much as $2 to use nonbank ATMs. Noncustomers also may still be charged by their own banks for using Washington Mutual's ATMs.

Copyright © 2004 Dow Jones &amp; Company, Inc. All Rights Reserved.

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[Steven_Monk]

I have a Wells Fargo account. When I use my NETELLER debit card, I am charged $1.50. Since, the NETELLER card is a "Star ATM" I hope these transactions will be included in the new waivers.

[mmbt0ne]

USAA gives back up to $15 a month in ATM fees since they don't have any ATMs. It's like my own little rakeback program [img]/images/graemlins/grin.gif[/img]

[GrannyMae]

i've paid $15 this week in NETeller foriegn atm fees, and this is on top of the $2 per thou they charge to move it to the card.

waiving fees was totally unexpected tho. i think i imagined fees continuing to rise, not be waived.