Chase Paves Way for Banks to Raise ATM Fees

is now charging noncustomers a whopping $5 fee every time they withdraw any amount of cash at one of its automated teller machines in Illinois. 

In Texas , it is now charging noncustomers $4.  This is on top of any fees incurred during the transaction by the person's own bank for using another ATM, which can be up to $3.

While this may sound outlandish, especially amid the current economic climate, this hike in fees is expected to set a precedent that results in other banks raising their prices as well.

In light of this, Sachem Patch asked ATM users at a branch in Holbrook whether they would consider paying $5 to use an ATM at a bank other than their own. 

Here are some of the replies from Holbrook residents:

Deanna Pucciarelli said that she would never pay that much for a bank transaction: "It kills me to spend $1.50 sometimes."

"Absolutely not," Kristen Tucci said emphatically in regard to the notion of paying that steep of a cost.

"No, I think what they're charging now is excessive," said Catherine Harrison.  "It's an electronic transfer; no one touches it.  What does it cost them?  It's not like they have to have someone to do a transaction."

Michael Frato called the price increase "ridiculous," and would not consent to paying $5 per withdrawal.  "Absolutely not," he said.  "That's way out of control.  I think it's wrong.  People ultimately get charged twice.  If I'm at Chase, I get charged by them — and my bank.  It sucks all around."

Most local bank customers questioned, like Lissette Lopez, maintain that they would not, under any circumstances, pay such an unreasonable amount. 

Lopez said, "Never.  There was another bank charging $3.50, which I thought was ridiculous.  Shame on you Chase!"

Other banks that have already upped their ATM fees for noncustomers include:  which used to offer free withdrawals, and now charges $2 per transaction.  now charges a $3 fee for the luxury of using its machines.  It previously charged $3 at some ATMs and $2.50 or less at others.

has the second -largest network of ATMs in the U.S. — trailing behind (BAC) — with 16,000 machines, and is asking nearly double the national average of what banks charge noncustomers, which is between $2.30 and $2.60.

In 2007, quietly raised the ATM surcharge for noncustomers to withdraw money at most of its ATMS nationwide from $2 to $3, which was the highest such fee ever imposed by a major bank.  It was a move expected to prompt an increased incidence in higher fees throughout an industry that tends to follow the leader when it comes to punitive charges.

More and more banks are relying on fees and other charges, such as on overdrawing an account, paying late or going over the limit on credit cards, as a more steady and reliable source of income than revenue stemming from various types of loans, where there is a much greater risk of default involved.

While has not divulged whether or not it has plans to expand fees nationwide, analysts are making the prediction that it is the inevitable end result.