COLLEGE PARK – Nearly half of the banks recently surveyed in Maryland have capitalized on a new-found ability to charge a fee to customers who pull money from another bank’s automatic teller machine, a public interest group said Thursday.
The customers are also charged a user fee by the other bank.
“Charging consumers twice to use an ATM once only doubles the cost of ATM transactions for consumers while generating millions of dollars in unearned revenue for ATM owners,” said Matthew Nisbet, campaign organizer for the Maryland Public Interest Research Group.
MaryPIRG is encouraging customers to contact their state and federal legislators to introduce bills to prohibit the double charges.
During the first two weeks of September, MaryPIRG and its counterparts in other states surveyed 458 ATMs in 19 states and the District of Columbia. They were checking to see if the banks charged user fees to their customers and to others using their machines.
The groups also were checking to see if the user fee was posted on a sign on the ATM or on the computer screen.
Since April 1, the two national ATM networks, Cirrus and Plus, have been allowing banks to charge their customers when they pull money from other bank’s machines.
Out of the 20 states surveyed, Maryland had the fourth largest number of banks issuing a fee to customers who use ATMs of banks other than their own.
Of the 21 banks in Maryland surveyed, 10 now charge a user fee of $1 to customers who use other banks’ ATMs. That was the average fee charged in other states, Nisbet said.
“Our own machines are a convenience to our customers,” said Julie Turner-Davis, a spokeswoman for NationsBank. “It’s not fair to the customers to allow non-customers to use the machines for free.”
“All banks are going to charge their non-customers,” said Geraldine Henry-Ajani, assistant manager of the Chevy Chase Bank in College Park.
Chevy Chase and NationsBank were among the 10 charging their customers the additional fee when they used another bank’s ATM. Other banks were operated by Citizens, First Union and Carrollton.
The surcharges allow banks to maintain and purchase the ATMs, Turner-Davis said.
Of the 10 banks in Maryland found to be issuing the additional surcharge, all posted a sign on the machine listing the amount. But only one of them posted a sign on the screen, the survey found.
Typically, banks that disclose the fee on the ATM screen do so after the banking transaction has been made. A customer has the opportunity to cancel the transaction at that point, but most choose not to do so.
“People will comply with the access fee when they’ve already gone through the transaction,” Nisbet said. “The [surcharge warning] should be on the first screen.”
To avoid additional ATM fees, customers should use their own bank’s ATMs, use bank tellers instead of ATMs or use personal checks or credit cards instead of cash to make payments, Nisbet said.
Also, if an ATM transaction must be made, it should be made in large increments to avoid multiple transactions, he said.
“People who use ATMs tend to make more transactions because they withdraw less money than people who go to tellers,” Nisbet said.
State legislators in Pennsylvania and Massachusetts have introduced bills banning the additional fees, and similar bills were introduced in Congress this year. They did not pass. The Maryland legislature passed a bill this year, which Gov. Parris Glendening signed into law April 30, to have the State Bank Commission conduct a study of which state banks list the surcharge amounts on their screens. -30-