Automated Teller Machines:
Banks Reported That Use of Surcharge Fees Has Increased
GGD-97-90, May 16, 1997
Pursuant to a congressional request, GAO provided information on fee-charging practices of banks and thrifts with regard to automated teller machines (ATM) used by individuals who do not hold accounts at the institutions owning the ATMs, focusing on GAO survey data on the number of: (1) banks that operate ATMs; and (2) these banks that surcharge non-account holders and the amounts of the surcharges assessed. GAO did not attempt to determine the effect surcharge fees have on the deployment of new ATMS or intend to address whether ATM operators are adequately disclosing information on ATM fees to customers.
GAO noted that: (1) on the basis of its survey, GAO estimates that, as of February 1, 1997, about three-fourths of all banks in the United States operated ATMs; (2) of the estimated 8,600 banks that operated ATMs as of February 1, an estimated 8,000 had ATMs as of December 31, 1995; (3) in addition, GAO estimates that, as of February 1, 1997, banks operated about 119,000 ATMs, an increase from the 89,000 ATMs they operated at the end of 1995; (4) over this period, the reported increases in ATM deployment occurred at both on-premise (i.e., at banking facilities) and off-premise locations (i.e., at locations not at a banking facility); (5) about one-third of the banks that operated ATMs reported that they imposed surcharges on non-account holders who used their machines; (6) more of the large banks than smaller banks reported surcharging and a greater percentage of the large banks reported that they began surcharging during the past year; (7) GAO's survey showed that, from the end of 1995 to February 1, 1997, there was an estimated 320-percent increase in the number of ATMs that had surcharge fees; (8) in addition, according to GAO's survey, the average surcharge fee had more than tripled since the end of 1995 to reach an average of $0.62 for all banks; (9) the average surcharge fee for large banks was $0.71 compared to $0.48 for smaller banks; (10) the average reported surcharge fee for ATMs with surcharges was $1.14 in 1997; (11) according to the four large nonbank ATM operators with whom GAO spoke, the number of ATMs they owned remained about the same in the past year; (12) for the four nonbanks, the average surcharge increased from $0.12 in December 1995 to $0.32 as of February 1, 1997; and (13) the average fee for the three nonbanks that surcharged increased from $0.51 to $0.71 during the same period.