ATM fees down $125m since warnings posted

Wednesday February 17, 2010

Australian banks customers have significantly cut down their usage of competitors ATMs, thereby saving themselves $125 million ever since the mandatory fee warnings were introduced in March 2009. This equates to an 18 per cent decline in withdrawals or 62.2 million fewer withdrawals overall.

The regulations were introduced in the Reserve bank's attempt to eradicate banks interchanging fees when customers use opposition banks ATMs.

The new rules stated that ATM owners, of which approximately 60 per cent are independently owned, could charge cardholders a direct fee for use of their ATMs as long as any charges are displayed before withdrawals are completed.

One of the biggest changes in trends since the start of the regulations on March 3rd 2009 was the number of withdrawals and the cash amount being taken in one transaction. Results have shown that since March banks customers are now making three less withdrawals or so per person and the average cash amount has risen $10 to $155, per transaction (if using a bank competitors ATM). Even the number of total withdrawals declined with a drop of 342.2 million in 2008 to 280 million withdrawals in 2009.

Own bank ATM usage also reflected this trend towards keeping within a customer's own banking lender with the rate of growth in own-bank ATM use doubling to over 10 per cent (or an additional 40 million withdrawals) which means customers have saved themselves almost $125 million in competitor ATM fees.

Other figures show that the Christmas season in particular the number of foreign banks ATMs usage decline almost 20 per cent.

The changes that were felt nationwide occurred after the Reserve Bank of Australia introduced new regulations that meant that ATMs had to display onscreen warnings of any fees that a customer would be charged if they used a different banks ATM facilities. This fee is usually around the $2 mark.

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