Special to the American Banker

In the nine years since Texas allowed banks to charge noncustomers a fee for using their ATMs, the 10 largest banks have adopted the practice, according to a consumer group here.

Consumers Union, publisher of Consumer Reports, predicted Monday that banks nationwide will start imposing the new ATM fees.

"The Consumers Union study shows that the pledge some banks have made to avoid added fees may not last after the spotlight fades," said Michelle Meier, government affairs counsel in Consumers Union's office here. "The widespread double billing by Texas banks is a harbinger of what consumers across the country can expect."

In April, Visa and MasterCard allowed member banks to start charging noncustomers a fee. The move ignited a political fire storm, prompting lawmakers to introduce bills that would ban the fees or require greater disclosure. Texas banks were allowed to charge the fees in 1987.

John Hall, spokesman for the American Bankers Association, defended the surcharges as a way to pay for more ATM locations.

"Banks have been able to put them in places where there wasn't enough transaction volume to make a business case for an ATM," said Mr. Hall. "Through that added revenue, they're able to place them in locations where consumers want them."

Mr. Hall added that customers can avoid ATM fees, but noted, "There's a price for convenience."

Mr. Olaya is an intern with the Institute on Political Journalism, a program of the Fund for American Studies.

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