ATM Fee Charges and How To Avoid Them…

By FutureNestEgg | May 4, 2009

If you use an ATM that is not owned by your bank then you will be charged a hefty ATM fee. The ATMs not owned by your bank are called foreign ATMs. When you use these ATMs, the fee that will be debited from your account will be displayed on the screen. You will be given an option to either proceed or cancel – so it is entirely up to you.

Up until 2008 these fees were charged by your bank at the end of month and hence there was not much transparency. Since the beginning of 2009, ATM operators will charge the fees at the time of using the ATM and this way it is much transparent. Currently the foreign ATM fees is between $1.50 and $2.00.

Some ATM operators will also charge you a fee for balance inquiry. So if you use one these ATMs for balance inquiry and withdrawal then you will be charged twice.

As mentioned earlier, prior to 2009 these foreign ATM fees were charged by banks. So one would naturally assume that banks no more charge these fees (since it is now being charged by the ATM operators). But unfortunately most banks still charge a fee – this fee is called ‘disloyalty fee’. This fee is not as high as the old one – currently it is between 10 cents and 50 cents – but it is still money coming out of your account. You basically can get charged twice – foreign fee plus disloyalty fee.

The foreign ATM fee is totally avoidable – here are somethings you can do to protect yourself from this fee:

1. Make yourself aware of the ATM machines in your area. The closest ATM of my bank in my area is at the local petrol station. I withdraw how much ever I need for the week at the time of filling my car.

2. If you are not with one of the big banks then you will not have access to a wide ATM network. Not to worry – your financial institution will usually have an agreement with one of the banks and as long as you use their ATMs you will not be charged this fee. Your financial institution will have a list of the right ATMs on their website – if not just call them and find out and make sure you are aware of all the right ATMs.

3. Use EFTPOS for your withdrawals – If you need cash, withdraw when paying by EFTPOS.

4. For balance inquiry use internet banking or phone banking. Some institutions will even sms you your balance.

Foreign ATM fees and disloyalty fees is though a pain, it is totally avoidable – by taking a few simple steps you can escape from this fee.