Getting Nicked at the ATM

Need cash quick? Think twice before using just any automated teller machine, especially if it’s not your bank’s own; it could cost you an extra $1.50. For customers willing to spend a little time and effort, there is an alternative to paying that surcharge.

A group of banks and thrifts have pledged not to levy an ATM surcharge on non-customers. The alliance, which includes Sanwa Bank, Glendale Federal Bank, Union Bank of California, Coast Federal Bank, Bay View Federal Bank and CU Cooperative (credit union ATMs), offers more than 1,500 ATMs that won’t add a non-customer surcharge.

But that number pales in comparison with the total operated by Bank of America, Wells Fargo and Home Savings of America, which together account for about half of the 15,000 ATMs in California. These three each add a $1.50 surcharge on non-customer withdrawals, a relative pittance and a sensible business decision on the part of the banks--but for customers it all adds up.

It costs about $30,000 to $35,000 to buy and install an ATM. Bank of America says it has made a hefty investment in its ATM network, the nation’s biggest. And so, the bank contends, non-customers should pay a convenience premium for using it.

Legislation has been introduced in both Washington and Sacramento to ban the surcharges. Beginning July 1, a new state law will require banks to disclose ATM fees on-screen, as some already do, and allow customers to cancel transactions without charge.

But for now, consumers will mainly have to make their own decisions on the question of convenience versus a surcharge. Be smart.