Are the looming Eftpos charge hikes really justified?

The bovver boys at the banks are at it again, putting in the electronic boot to their customers.

The bovver boys at the banks are at it again, putting in the electronic boot to their customers. The acronym ATM (automatic telling machine) might just as well mean today "automatically taking money". WestpacTrust announced last week it would more than treble ATM charges to its customers who use rival banks’ ATM machines. It will also, in October, increase fees for electronic transactions, including Eftpos, by 10 cents to 35 cents. Other banks reportedly say they have no plans to increase their charges but, hey, banks are like the oil companies. One puts up its prices and within a few days — always reluctantly — the others follow suit. An ASB Bank spokeswoman has been quoted as saying it is likely other banks will follow suit with similar fees to protect the use of their ATMs. ATM charges by the major banks range from 35 cents to 50 cents, and Eftpos charges from 35 cents to 40 cents. The key to the latest rise seems to be the 50-cent to $1 transaction fee each bank charges the others where their machine is used for "foreign" customers. In mid-1998 Computerworld did some research into the cost of electronic transactions. Former Databank chief executive Tony Hood agreed at the time that around 15 cents was probably about right. That included the cost of consumables in ATM machines, along with the cost of the money to sit in the machines. None of the banks were prepared to comment on the grounds of commercial sensitivity. What’s gone wrong with the ATM value proposition? The banks have been happy to drive their customers to ATMs and Eftpos so they can reduce the cost of bricks and mortar by closing branches. Interest rates are now somewhat lower than in mid-1998, too, so has the cost of consumables gone up that much? I think not. It’s grown to become a captive market and the banks are doing little more than raping and pillaging. Earlier this year I questioned some bank charges with my own bank. The counter clerk (yes, they do exist) told me it was disgraceful and that electronic transactions cost his bank just 17 cents. He may not now have a job, of course, because the bank was subsequently bought by one of the Big Four, which promptly closed down the surplus branches. Now, I get to stand in a queue in front of far too few tellers if I want to do an in-house transaction. Oh, and I get charged even more for that. Most of the complaints received by Citizens’ Advice Bureaus and the Consumer Institute are specifically about bank charges. Jackson is Computerworld’s Wellington bureau chief. Contact him at randal_jackson Letters for publication can be emailed to

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