$5 ATM Fee Test Unsuccessful

Restrictions on bank fees and practices that the federal government put in place late last year at first seemed to be a good thing for consumers. Limits on overdraft fees and debit charges keep costs of transactions reasonable. However, banks have started fighting back and increasing non-regulated fees.

Last month, JP Morgan Chase began testing $5 ATM fees for non-customers. This fee was substantially higher than the average $2-3 that most banks charge. According to Chase, they were considering raising non-regulated bank fees to make up for the loss of income in other areas.

As reported by CNN Money, the story came to a happy end earlier this week when Chase announced it was ending the test because it was unsuccessful. The company has no current plans to roll it out into other markets. Apparently, non-customers voted with their feet and withdrew money from other bank machines. The free market determined that the bank could not get away with boosting income in this fashion.

That doesn't mean that you won't see higher and new bank fees this year. Banks are still keen to make up the lost income and will find other ways to do so. Expect to see a more gradual rise in ATM fees for both customers and non-customers. The amount of overdraft fees charged once a customer has opted in is on the rise, cresting at close to $40 per transaction recently.

Debit rewards are another area hard hit by the new regulations. Several banks, including Bank of America and SunTrust, have announced that they will rescind their debit card reward program this spring. The reward programs offered points for volume of activity that customers could trade in for consumer goods or even cash back to their accounts. Expect that this program termination will roll out to other banks as the year goes on.

The good news is that protecting yourself from the new fees is possible with a little research and forethought. You can avoid non-customer ATM fees by planning your cash needs earlier and withdraw only from your own bank's machines. Avoid overdraft charges by keeping a running bank balance, either in a software program or in your checkbook, so you always know how much money you have left over. Check the maintenance fees you are being charged on your bank accounts annually and ask your bank to waive them. If they do not, search for other, more accommodating banks.