Big banks move in unison on unpopular ATM fee
Competitive pressure is being credited for banks moving in unison on their ATM fees this week.
Bank representatives say each made the decision independently.
ANZ announced on Monday it was to remove the $1 fee it charged customers for using other banks’ ATMs. It was followed by Westpac later in the day.
By yesterday morning ASB, Bank of New Zealand and Kiwibank had all joined in.
Banking commentator David Tripe said that once one bank made the decision, it forced the others to move. If they did not, it would put them at a disadvantage to their competitors, he said.
Tripe said fees were ‘‘a bit of a merry-go-round’’ as banks kept in step with each other.
‘‘[Otherwise] you look out at your competitors and think: ‘I’m going to be in trouble – just think what it would look like if we hang on to the fee.’’’
While this time the move was in customers’ favour, Tripe said that was not always the case. When they started charging the same fee in 1997, the process happened in reverse, with one introducing it and the rest following, he said.
Consumer NZ chief executive Sue Chetwin said it was comfortable for banks to stick with their fees while their competitors did. ‘‘They all hold on, then when one rolls over the whole lot do. What does that actually say?’’
But she said it was a win for customers that the unpopular fee had been cut.
A spokesman for the New Zealand Bankers’ Association said the decision to remove the fees was made by each bank independently. ‘‘Our banks operate in a very competitive environment … The speed at which some banks have moved shows just how competitive they are.’’
Tripe said it was possible that ANZ had decided to cut the fee as a way to boost consumers’ dwindling interest in ATMs.