Have Members Lost Patience for ATM Fees?

More consumers than ever say they will do just about anything to dodge ATM fees, and that could be putting more pressure on credit unions and other financial institutions to join or create fee-free ATM networks, according to Maynard, Massachusetts-based Mercator Advisory Group.

Its new survey of 3,001 U.S. adults found that in 2017, 77% of U.S. consumers do whatever they can to avoid paying ATM fees. That was the highest level since 2011 and 2012 and was up seven percentage points from 70% in 2016.

Additionally, 67% of U.S. consumers in the survey said they actively sort get out no-fee ATMs, up from 57% in 2016 and 60% back in 2011. Mercator Advisory Group attributed some of the change to greater consumer awareness of surcharge-free networks and more credit union and bank participation in those networks.

“Given that bank branches are closing in record numbers, and cash cannot be dispensed through mobile channels alone, surcharge-free networks serve a rising need,” Mercator Advisory Group Senior Manager of Primary Data Services Karen Augustine said. “Surcharge-free ATM network participation is now a top criterion for consumers in selecting a bank or credit union.”

The Mercator study also found that 36% of respondents said they’ve never paid an ATM surcharge — also the highest rate since 2011 and 2012 and up six percentage points from last year. Only 30% of respondents said they pay ATM surcharges when they travel away from home. That has generally trended down from a high of 36% in 2011.

In addition, Mercator reported that 19% of respondents don’t pay ATM surcharges because their credit unions or banks reimburse them. In 2015 and 2016, 16% and 18% of respondents said the same, respectively.

The data comes about six months after another study found that ATM fees had hit a record high for the 11th year in a row and that checking fees had also increased. That study reported that the average total cost of an out-of-network ATM withdrawal was $4.69, up 2.6% from $4.57 a year earlier. ATM fees were also up 55% over the past decade. It also said the average ATM surcharge hit a new record for the 13th year in a row, rising to $2.97 from $2.90, and the average fee charged by a consumer’s own bank for going outside the ATM network rose 3% to $1.72, which was also a new high.

However, the new Mercator study suggested that consumers are getting pickier about their ATMs and less tolerant of fees to use them. Only about one in four respondents (22%) said they were willing to pay an ATM surcharge in order to use a convenient machine, it noted.