According to Harkin, the national average per ATM transaction is $2.50, even though it can go up to $5. "The most shocking part of this fee is that, on average, the real cost of processing a transaction today is only 36 cents or [image-nocss] less. Where does the rest of the money go? It is going to the big banks, the big card networks and independent machine owners," he said.
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Disheartened consumer advocates hope that the soon-to-be-created Consumer Financial Protection Agency will play the role of protecting consumers from all high banking fees.
"New laws will definitely provide strong protection against the unfair practice of charging consumers high fees to use ATMs, which when combined with the bank fee and fees from the ATM provider can be as high as $5 to withdraw just $20," Ed Mierzwinski, consumer program director of the consumer advocate U.S. Public Interest Research Group, told the financial news website. "The cost of an ATM transaction is closer to 50 cents and banks were making a 900% profit."
Though the measure to cap ATM fees to 50 cents is highly popular with consumers, ATM business operators say it will hurt small businesses and actually end up benefiting big banks, the report said.
Carl Myers, the co-founder of ATM ServNet of Cedarville, Ohio, said that, if passed, the amendment would be devastating to the roughly 2,000 ATM owners and operators across the country, not to mention his own business which installs and repairs ATMs at convenience stores. C-stores will also see reduced sales if the ATMs in their stores start to disappear, he said. "There will be thousands of people who will be rendered joblessfrom the ATM operators to stores," Myers told the news site.
Myers' ATM business, which employs four workers, got started around 1996, when there was a dramatic surge in ATM terminals. That's because ATM operators could start charging access fees in 1996. Since then, the number of ATMs has grown 184% to 425,010, according to research cited by the report from the American Bankers Association. About one-fourth of the ATMs are run by nonbanks, it said.
According to the bank group, passage of the Harkin amendment would lead to a dramatic reduction in the number of ATMs, and will also stop production and distribution of new terminals. Research from the group also concluded that it would hurt consumers by giving them fewer choices.
"Once the independent ATM business is removed, big banks will have a monopoly and start charging fees to their own customers," said Myers.
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