Your Money : Study Finds ATM Charges Up, Costs Down : Finance: Consumer group says banks earned $2 billion in profits from the machines. Bankers call the fees justified.

Consumers are paying top dollar to banks through automatic teller machines, even though banks are saving money in labor costs and paperwork by replacing human tellers with machines, a consumer group said Wednesday.

With the start of the summer travel season, consumers should take extra steps to ensure they are not overcharged for ATM use, the Consumer Federation of America said.

Bankers, for their part, see no need to apologize, saying ATMs deliver a valuable service. Rather, they argue, consumers should shop around for the best deals.

ATM cardholders are handing over an average of $37 a year in profits to their banks from automatic teller use, according to the consumer group’s study, which is based on industry data. Cardholders use an ATM an average of 6.7 times a month.

In 1993, banks made nearly $2 billion in profits from ATM business. That covers $2.90 billion in ATM transaction fees and savings of $2.34 billion by not using human tellers.

Even as they save money by substituting machines for humans, banks have raised ATM fees as much as three times the rate of inflation over the past three years, the Washington-based consumer group said.

“Throughout the economy, self-service facilities result in lower costs for the consumer,” said Chris Lewis, a spokesman for the group. “But in banking, self-service is regarded as a privilege for which the consumer is required to pay a premium for saving the bank money.”

Lewis said the cost savings of electronic banking “are not trickling down to consumers” because more banks are charging ATM fees and those fees “are climbing higher and higher.”

Teller machines permit consumers to withdraw money or deposit funds without the help of a bank employee. Regional and national networks allow customers from different banks to do routine service while hundreds or even thousands of miles from home.

Bankers feel they have no need to repent for the charges.

“We don’t apologize for the fees,” said Ed Alwood of the American Bankers Assn. “We think we deliver a valuable service, and obviously our customers do too.”

He added, “People must shop around for the type of mix of fees and services that fit their needs.”

To cut costs, the consumer group urged consumers--especially summer travelers--to use their own bank’s ATMs whenever possible. The study said only 11.7% of banks charge their own customers an ATM fee, and that fee averages about 25 cents.

By contrast, 82.3% of banks levy fees on consumers who are not their account holders, and those fees are much higher.