Pay Now or Pay Later
Mar 29 '00 (Updated Apr 12 '00)
So you think that banks are a bunch of big, bad money grabbers? First of all, let me state that I have only paid a couple of ATM surcharges in my life. One of my main criteria for choosing a bank is that they have centralized, convenient locations with a branch near where I work and where I live. Washington Mutual meets this criteria for me.
Transactions with Your Own Bank
That being said, I believe that I should never have to pay ATM fees with a bank that holds my account. One reason is that having ATMs reduces payroll expenses the bank pays since it reduces the number of employees they need to conduct business. Also, they have your money which they are re-investing in business loans, mortgage loans, etc and earning interest income associated with that money. This is of course minus the limits imposed by the federal government where the bank has a limit on their assets they can re-invest to insure solvency.
Transactions with Another Bank
On the other hand, when you go to another bank there are certain administrative fees associated with that transaction. That is why I am making a statement pay now or pay later. Let's face it. In this free enterprise system, a bank is in it to make money like everyone else.
Some ATM machines are bought outright by the bank and part of their capital equipment, Others are leased equipment from an independent third party. ATM machines are expensive to buy. They run from $5,000 to $7,000 if bought out right and if leased run up to $15,000 for the bank. This cost is a standard ATM machine. I just read that banks are now installing talking ATMs to attract blind and low-vision customers. I am not sure how much more expensive they are but I bet they are more costly. I know Washington Mutual has leased machines because one of their machines ate my ATM card because of a mechanical problem and I had to wait half a day to get my card back because only the independent lessor could retrieve the card. Let me tell you, I never realized how dependent I was on my ATM card until I was without it for half a day.
The bank also pays additional fees if the ATMs are not located on their premises or leased: (1) monthly maintenance - monthly money restocking, collection, servicing, etc and (2) monthly rental cost for the location where the remote ATM machine is located. The lessor gets paid additionally for that.
Conclusion
In the cases where ATM machines are conveniently placed for the customer and inconveniently located for the bank, then I think it is reasonable to pay a small fee for the convenience. You should pay for that high expense associated with that convenience. On the other hand, in cases where the machines are located on the bank's premises, the transaction is just an electronic transfer between banks, and I do not think a charge should be incurred, since there is not an employee requirement to intervene. Since the bank cannot differentiate between a leased machine or an owned machine, I guess they decided to recoup their costs by just restricting the charges to non-customers. It makes business sense to me because then the customer has an incentive to open an account with that bank.
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Epinions.com ID:
doglover
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