ATM Direct Charges - New ATM Fee Changes, what they are and how to avoid them

Australia's automatic teller machines (ATMs) are now required to display certain fees, under a new regulatory system that commenced Tuesday, March 3, 2009.

The aim of the new system is to take the confusion out of fees charged to the customer by making those fees transparent at the time of the ATM transaction.

The reforms are the work of the Reserve Bank of Australia (RBA) and are also intended to open up the ATM market to new players which, it hopes, will eventually drive down prices and improve ATM accessibility.

FOREIGN ATM FEES

The most obvious change concerns fees charged for using a ‘foreign’ ATM or one that is not owned by your bank. These are the fees that really sting because the majority of consumers are unaware of them, until they get their monthly statement!

Foreign ATM fees are paid by the bank on your behalf to the owner of the ATM used.

Under the new system, ATM owners have to reveal their direct charges and give users from another bank the option to either go ahead or cancel the transaction and retrieve their card if they are not willing to pay the fee shown on the ATM screen.

While this new system certainly makes the fee structure much clearer than it has been in the past, you may not like what you see.

For instance, checking your account balance on an ATM not owned by your bank could cost you $2. If you then decide to withdraw money at the same time, you are likely to be hit with another $2 fee, depleting your account of $4 in one go.

ATM Direct Charges Fee Changes

DISLOYALTY FEES

As the name implies, disloyalty fees can be incurred after you use another bank’s ATM. These fees range from nothing to all to 50 cents a transaction. Some banks charge them, others don’t. To make it even more confusing, some banks that charge disloyalty fees will also waive them for certain accounts. Checking with your own bank to determine these fees is your best course of action.

ATM Fees - How They Are Charged

CLUBS, PUBS AND CONVENIENCE STORES

More often than not, there is a limited choice of ATMs at entertainment venues. Fees incurred for using your card at these ATMs will vary and they are not, as yet, known by us. Under the new system, ATMs will, however, have to display fees and give you the choice to proceed or to terminate the transaction without incurring a fee. Easy access to cash by vulnerable patrons of clubs and pubs has always been a concern but the trade-off is convenience to the majority. Using ATMS at convenience stores and petrol stations may also not be a cost-effective thing to do regularly.

HOW TO AVOID ATM FEES

Know your own bank's ATM network: Find out what agreements your bank, building society or credit union has with other institutions that allow fee-free use of their ATMs.
Be aware of ATM locations: Make it your business to know where your own bank's ATMS are in areas you frequently visit. Using these machines only will reduce or eliminate fees.
Free transactions: Find out how many free transactions come with your bank account and keep a count of them.
Use EFTPOS to withdraw extra cash: Instead of withdrawing small amounts of money regularly at any ATM in sight, plan ahead and withdraw extra cash when making EFTPOS purchases. This only counts as one transaction and, hopefully, will stop you incurring further transaction fees.
Other ways to check your account balance: In most instances it's free to check your account balance via the phone or internet. Keeping a tab on your balance is also more cost effective by asking for a receipt after withdrawing cash. That way, you pay only one fee instead of two at a foreign ATM.

Transaction Accounts ...