New Zealand banks are being urged to follow the lead of their Australian counterparts and scrap the ATM fee they charge customers of other banks.
New Zealanders pay a small fee every time they use an ATM not owned by their regular bank. Photo: 123 RF
Australia's four big banks announced yesterday they would axe the unpopular charge put on people using an ATM that did not belong to their own bank.
The Commonwealth Bank was the first to move, with Westpac, ANZ and NAB quickly making similar announcements.
On this side of the Tasman, Kiwibank said while it reviewed its fees and rates all the time, it had no plans to change what it charged.
In a statement, ANZ said only a small number of customers choose to use other banks' machines.
It also said fees for customers using other banks' ATMs were lower in New Zealand than was charged in Australia.
Further, the cost and revenue structure of ATMs in Australia was different to New Zealand, ANZ said.
However, it said all its fees were constantly under review to ensure ANZ was competitive.
Westpac New Zealand said it was looking at the developments in Australia with interest.
"We need to consider the charging arrangements between banks in New Zealand which are very different to those in Australia, and certainly more complex," it said in a statement.
"We're always looking for ways to better meet the needs of our customers. This year we removed or reduced 11 banking fees in direct response to customer feedback, ensuring our fees are fair and easy to understand."
ASB said it was aware of the moves by banks in Australia and it regularly reviewed its products and services in response to customer preferences.
Consumer New Zealand chief executive Sue Chetwin said there was no need for the fee.
"We have always thought it was unfair, we don't really think that it costs the banks anything, and there's no reason to have these fees."
But Ms Chetwin said New Zealand banks were unlikely to get rid of the fee unless one bank moved first, forcing the others to follow suit.
Given many of the banks were Australian-owned, New Zealanders should be treated fairly, she said.
David Tripe from the School of Economics and Finance at Massey University said banks hit customers with a fee because the card-issuing bank was charged by the bank that owns the ATM for providing the service.
"If, for example, you use a Westpac card at an ATM that is owned by the ANZ, the ANZ incur a cost. That cost was originally estimated at somewhere around 50-60 cents; what's ended up happening is that cost has been recovered by the imposition of a charge on the card holder."
But Associate Professor Tripe said the fee being charged in Australia was much higher than the fee in New Zealand.
"One of the differences with the New Zealand fee is that it has borne some relationship to cost, so therefore it's harder to argue that it's unreasonable.
"Because the New Zealand fee is lower, it may well continue."