New Reserve Bank rules to apply to ATM's

The Reserve Bank is going to introduce new rules governing ATM charges as of March. This will mean that bank customers could face millions of dollars in extra ATM fees - and a smaller choice of free machines.

Currently fees on independent ATM's are capped at $2 but from March owners will be able to charge whatever they like, raising concerns that operators will increase charges according to location or time of day and take advantage of drunken pub customers.

By displaying charges on the ATM screen customers will have the choice of whether to pay the required fee or not.

Consumer groups are concerned that lack of price control could lead to all sorts of tactics to increase revenue, including raising charges in remote locations or late at night, when people are least likely to shop around for a cheaper ATM.

Under the current system, banks charge each other a fee to use each other's cash machines, but this is often absorbed to provide customers with free access to as many ATM's as possible.

Under the new system, banks will no longer charge each other a fee instead, customers will be charged directly by the owner of the ATM.
This removes the banks' control over the charges and gives ATM owners carte blanche to charge what they like.

Many institutions that used to pay for their customers to have free access to other banks ATM's are now canceling their arrangements.

Published on January 1-th, 2009 in Credit Cards
Damon Rasheed is the CEO of Rate Detective, an Australian financial service comparison sites specialising in Life Insurance, Income Protection Insurance and home loans. Damon holds a Master's Degree in Economics from the University of Melbourne and has been involved in many start-up internet businesses.