David Koch explains why you shouldn’t be paying to withdraw cash
LAZY Australians are forking out nearly $800 million a year in ATM withdrawal fees, according to new research.
A survey of 2031 people by comparison website Finder.com.au has found more than half (50.2 per cent) of bank customers withdraw cash at other ATMs at least once a month, and 20.4 per cent do so at least once a fortnight.
With fees for using competing bank ATMs as high as $2.50, that works out to $65.6 million in wasted ATM fees every month, or $787.8 million a year paid by more than nine million Australians.
Finder.com.au money expert Bessie Hassan said Australians need to change their withdrawing habits, as the convenience offered by using the nearest ATM was not worth what we are paying.
“ATM withdrawal fees are one banking fee you should never pay,” she said. “Unsuspecting customers are being stung by as much as $2.50 to use an independent ATM. For a small withdrawal, fees can be a significant percentage.”
Victorians were the worst offenders, with 51.3 per cent regularly paying to withdraw their own cash from an ATM, while one in four customers in the ACT do so every week.
“That adds up to over $100 in fees a year just so you can spend your own money,” Ms Hassan said.
One in 12 (8.5 per cent) Australians have free access to cash at all ATMs. “Finder.com.au’s database shows there are transaction accounts where customers get their cash for free at all ATMs from banks such as ING, but these accounts require a regular income to retain free ATMs,” Ms Hassan said.
The research found women were the most likely to use other banks’ ATMs, and younger people were far more likely to than older people. Sixty per cent of Baby Boomers claimed they never did so, compared with just 24 per cent of Gen Y.
“A shocking 3.8 per cent of the younger Gen Y admit to using another bank’s ATM every single day,” Ms Hassan said.
Financial comparison websites Mozo.com.au and Canstar put the figure slightly lower, citing Reserve Bank data which showed a total 259,311,313 “foreign” ATM cash withdrawals in 2016.
“Assuming an average $2.00 per foreign ATM withdrawal, that equates to $518,622,626 of foreign ATM fees in 2016,” a Mozo.com.au spokeswoman said.
“Assuming an average $2.50 per foreign ATM withdrawal, that equates to $648,278,283 of foreign ATM fees in 2016.
“Major banks charge around $2.00, while independent operators charge around $2.50. The average foreign ATM fee isn’t going to be higher than $2.50 so, based on this, it’s hard to see how it can be any higher than $650 million.”
A Canstar spokeswoman, using the same RBA data, put the figure at $604,195,359, based on the average fee of $2.33. “It is not particularly accurate as the total ATM withdrawals include international ATMs and it does not take into account any rebates that apply on certain accounts,” she said.
PAYING FOR OUR OWN CASH
• Once a day 1.5pc
• Once a week 13.4pc
• Twice a week 5.5pc
• Once a fortnight 7.9pc
• Once a month 21.9pc
• Never 41.3pc
• I pay no fees for using another ATM 8.5pc