<h1>ATM fees hit record high, free checking accounts decline</h1>
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By Aaron Smith
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<a href="https://twitter.com/intent/user?screen_name=cnnmoney" class="soc-twtname">@CNNMoney</a>
<span class="cnnDateStamp">September 24, 2012: 2:21 PM ET</span>
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NEW YORK (CNNMoney) -- Banks are hiking ATM fees to record levels
and cutting back on free checking accounts, according to an industry
report issued Monday.
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The financial research firm Bankrate.com said ATM surcharges --
the fee charged when you use a machine that's isn't your bank's -- rose
for the eighth straight year, up 4%, to a record high of $2.50.
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In addition, the fee your bank charges to use another bank's ATM
rose 11% to $1.57. So for many customers, using an ATM from a competing
bank costs $4.07, an increase of 7% and a record.
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Banks traditionally provide ATMs for free to their own customers,
and cover their costs by charging consumers who use out of network
machines, according to Greg McBride, senior financial analyst for
Bankrate.com. But people are getting smarter about using only in-network
ATMs, which means that the companies are trying to make up for that
lost revenue.
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And there is more bad news for consumers. Bankrate.com also found that 39% of non-interest <a href="http://money.cnn.com/2012/06/08/pf/checking-accounts/index.htm?iid=EL">checking accounts</a>
provided by U.S. banks are free of charge to all customers. That's
compared to 45% last year and a peak of 76% in 2009, according to <a href="http://money.cnn.com/2012/09/12/pf/fdic-bank-accounts/index.html">Bankrate.com</a>.
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McBride says the banking industry has lost income due to an
increase in regulations, and that's made free checking accounts harder
to find.
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<span class="inStoryHeading"><a href="http://money.cnn.com/gallery/pf/2012/09/20/spending-10000.moneymag/index.html">Related: What to do with $10,000 now</a></span>
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"Two regulatory changes in particular have cut the legs out from
free checking, one putting restrictions on overdraft charges, and the
other limiting swipe fees when a consumer uses a debit card," he said.
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The swipe fees that retailers pay every time a customer uses a
debit card were reduced last year, said McBride. This followed
regulations imposed in 2010 that placed limits on overdraft fees.
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<a href="http://money.cnn.com/2012/08/13/pf/bank-fees-rise/index.html">Swipe fees and overdraft fees</a>
helped underwrite the costs of free checking before the regulations
were imposed, said McBride. Now, the bank industry is more selective
with free checking accounts, usually providing them only to preferred
customers, such as those with direct deposit accounts.
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And these types of cutbacks are affecting customer behavior. The
annual report found that 72% of customers would consider switching
accounts if their fees were raised -- up from 64% last year.
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The report said that higher-income customers, with at least
$75,000 in their accounts, were most likely to switch, with 82% saying
they would consider changing banks if fees were raised.
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First Published: September 24, 2012: 10:39 AM ET
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