Out-of-Network ATM Fees Reach an All-Time High. Cash Gets More Expensive

Oct 13, 2017

In a world, where there is a rise of ecommerce, credit/debit card use, and mobile payment platforms, running to the ATM for cash is a thing of the past for many people. Cash is increasingly becoming expensive, even when accessed electronically.

Cash Is becoming More Expensive

Across the nation, consumers are charged $4.69 to withdraw money from a so-called out-of-network ATM. That’s up 2.6% from 2016. This is according to the latest data from Bankrate Inc., a New York City-based consumer-research firm.

Among the top 25 metropolitan areas, Pittsburgh residents faced the highest fees. Here are the top 5 metro areas with the highest average ATM fee, according to Bankrate:

  1. Pittsburgh: $5.19
    2. New York: $5.14
    3. Washington D.C.: $5.11
    3. Cleveland: $5.11
    5. Atlanta: $5.05

Bankrate reports that the fee has now reached a record high for the 11th consecutive year. In fact, it’s went up fully 55% over the last 10 years. During the mentioned period of time, debit cards increasingly became more popular in stores, as a result of which consumers started carrying as much cash as they once did.

So, the higher out-of-network fee is the result of reduced demand for cash at ATMs, as Greg McBride, chief financial analyst at Bankrate, notes.

Merchants in the ecommerce industry can easily get approved for low-cost online payment processing by turning to a reputable processor and business funding provider like emerchantbroker.com. EMB, an award-winning processor that is voted #1 high risk processor in the US, offers exceptional services for credit card processing. EMB boasts an A+ rating with the BBB, is rated A by Card Payment Options and named one of Inc. 500’s Fastest Growing Companies of 2016.

Out-of-Network Fee, Surcharge, and Overdraft

The out-of-network fee is comprised of 2 components:

  1. A fee imposed by the ATM owner, which is known as a surcharge and is significantly higher as compared to the 2nd one
  2. A separate charge from the cardholder’s bank, which is rising faster

The 1st one is $2.97 on average, which is up 2.4% in 2016, according to Bankrate. The 2nd one is $1.72, which is up 3%. Bankrate reports that both fees are all-time highs. McBride predicts surcharges will soon start going higher.

According to McBride, since fewer people are making out-of-network ATM withdrawals, the cost associated with maintaining that network is being spread over fewer transactions.

Based on a CNN Money analysis, the country’s 3 largest consumer banks made about $6.4 billion off of ATM and overdraft fees in 2016, which is nearly $300 million more than in 2015.

So, ATM fees aren’t the only fees that are going higher. Overdraft fees follow the same tendency across the country. The average overdraft fee across the banks studied by Bankrate reached $33.38 in 2017. No technological explanation is available concerning the reason. Banks depend on fees to make money, and overdrafts are a reliable source of income since everyone believes they’ll never overdraft again.


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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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