Using an ATM owned by one of the big four banks will no longer incur a fee. Paul Rovere
Joanna Mather
September 24, 2017
AFR
The big four banks have jettisoned ATM fees in a move that will cost them tens of millions of dollars each but could give them some reprieve from public animosity.
Commonwealth Bank announced on Sunday morning that it would scrap the unpopular fees across its ATMs, which had been grabbing global headlines in connection with alleged money laundering.
By mid-afternoon rivals ANZ, Westpac and National Australia Bank had made similar announcements.
Consumer groups were happy, but both the government and opposition made it clear they would keep up pressure on the banking sector.
Nor will CBA have won many friends among its banking peers.
Sources said the industry had been working toward solution for so-called “foreign” ATM fees for some time but progress stalled after CBA withdrew from discussions.
Commonwealth Bank ATMs began promoting the decision to drop the charges on Friday.
CBA needs a good news story
Choice spokesman Tom Godfrey said CBA needed something positive to talk about.
“Whether it is issues with CommInsure, financial planning scandals or the issues they’ve had with AUSTRAC, this is a bank that needed a good-news story,” he said.
CBA will not reveal how much revenue it will lose by no longer charging a $2 fee to withdraw cash from its ATM.
But the figure is in the tens of millions and certainly less than $100 million, The Australian Financial Review understands.
Data from the Reserve Bank of Australia shows that Australians make 250 million transactions from ATMs owned by banks other than their own.
But ATM use is in decline. In 2016, the use of credit and debit cards overtook cash for the first time since records began.
Banks own about half of the nation’s ATMs. Customers will continue to be charged as much as $5 to withdraw money from independently owned cash machines.
ATM fees unpopular, withdrawals in decline
“While we had been actively working on how we provide fee free ATMs for our customers, we have decided to remove these fees all together from October,” ANZ group executive Fred Ohlsson said.
“We know ATM fees are one of the most unpopular and while our customers have benefited from our network of ATMs across the country, this is another example of acting on customer feedback as well as genuine reform from the industry.”
Commonwealth Bank group executive for retail banking Matt Comyn said the bank was aware the charges were unpopular among bank customers and decided to remove them from its network of 3400 machines.
“We have been listening to consumer groups and our customers and understand that there’s a need to make changes that benefit all Australians, no matter who they bank with. This is one of the steps we’re taking to make that happen,” Mr Comyn said.
Banks queued up to drop fee
The abolition of foreign ATM charges at Commonwealth Bank does not apply to ATMs operated by its subsidiary BankWest or customers using overseas cards.
ANZ and Westpac quickly joined its rival and pledged to scrap foreign ATM fees for its combined network of 5300 ATMs. The scrapping of fees applies to Westpac’s St George, Bank of Melbourne and BankSA ATMs.
NAB was the last to announce it would follow suit. The delay is believed to be related to the network of 3000 rediATMs it operates that can be accessed by customers of Bank of Queensland, Suncorp, CUA and many more.
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