Magazine article American Banker

CU-Linked Network Touts Edge on Bank Surcharges

Magazine article American Banker

CU-Linked Network Touts Edge on Bank Surcharges

Article excerpt

Co-op Financial Services, which manages a network of automated teller machines owned by credit unions, is trying to take advantage of the recent fee hikes for noncustomers by Bank of America Corp. and other institutions.

This week, the Rancho Cucamonga, Calif., association took out a half-page ad in USA Today declaring that it has more ATMs than the two largest banks combined and that people could avoid paying surcharge fees - which now run as high as $3 - if they join one of its member credit unions.

Stan Hollen, the president and chief executive officer of Co-op, said in an interview Wednesday that the ad is meant to reach both consumers, whom the association is wooing to join credit unions, and credit unions that are not part of the Co-op network.

"We want them to join the network," Mr. Hollen said, so Co-op plans to run ads in industry publications, too.

Samantha Smyth, Co-op's vice president of marketing, said it has run ads in local media with its partner credit unions, but this was its first national print ad.

Co-op offers free use of 25,000 ATMs in the United States and Canada to the 26 million debit card customers of 2,000 credit unions.

"The purpose of the ad in USA Today is to point out that there is a real value to credit unions ... and that consumers should seek out credit unions in the Co-op," Mr. Hollen said.

This summer, Bank of America, which has the largest bank-owned ATM fleet in the country, raised its surcharge for ATM use by noncustomers to $3, from $2. U.S. Bancorp later increased its surcharge to $3 on about 300 ATMs in California, and Wachovia Corp. hiked its surcharge to $3 at 200 East Coast ATMs.

Bankrate.com says the average ATM surcharge is $1.64.

Betty Reiss, a spokeswoman at B of A, said the Charlotte banking company's higher surcharge does not apply to about 6,300 ATMs at off-site locations such as malls, airports, universities, and convenience stores. …

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