USAA Federal Savings Bank has begun compensating customers for surcharges they incur when using other banks' automated teller machines.

USAA Federal, whose banking largely depends on such "foreign ATMs," said last week that it is rebating other banks' fees on as many as 10 withdrawals per customer per month. The rebates top out at $1.50 per withdrawal.

The bank has also eliminated the $1 transaction fee it used to charge on such withdrawals.

The changes are in keeping with USAA's "virtual" delivery strategy. The $6.4 billion-asset thrift owns only seven ATMs and one branch. Its 1.8 million customers rely on telephones, mail, ATMs, and personal computers to bank and pay bills.

Carryl Seaman, senior vice president of operations at USAA, said ATM fees and surcharges have been a "bone of contention" among customers. "We are taking this step in order to provide our account holders with an access channel that we think will make their banking much more convenient," Mr. Seaman said.

As surcharging has spread nationwide in the last year and a half, banks with relatively small numbers of ATMs have been looking for ways to satisfy their customers and prevent their moving to larger institutions that advertise no extra fees to customers using proprietary networks.

Some banks have joined surcharge-free alliances, essentially inviting anyone to use participants' machines without the extra fee. Others have dropped the fees they charged their own customers when using other institutions' ATMs.

USAA's more expensive offering of surcharge rebates is relatively rare and is an indication of the value the company attaches to having a broad range of delivery options.

The waivers and rebates essentially allow the holders of USAA's 315,299 deposit accounts to use most of the nation's 150,000 ATMs free of charge.

A handful of community banks are also giving the concept a try. This spring LBA Savings Bank, Lafayette, La., started reimbursing up to $1.50 for surcharges and waiving its 73-cent foreign transaction fee. Dennis Sullivan, LBA's marketing manager, said growth of the bank's 5,000 checking accounts "has been fairly flat" since the policy began. The policy, he said, will continue whether or not it helps the $260 million-asset bank achieve its goal of opening 500 new accounts.

"There is no way we could or would build 30 or 50 ATMs," Mr. Sullivan said. "There is no way we're going to spend that money to compete with the networks."

Greg D. Benson, a regulatory affairs official at America's Community Bankers in Washington, said community banks are wise to give something back to customers.

Community banks "don't have the large base of customers," he said. "This makes good business sense for them, to provide customer service and accessibility."

USAA does not have monthly fees or minimum balance requirements on checking accounts, but it does look to bill-payment products to recoup its costs. The bank charges $7.95 a month for PC bill payment, or $5.95 by telephone.

"We don't have a branch network," Mr. Seaman said. "We don't have an ATM network. When you weigh our cost of providing this service to the cost of deploying an ATM network, it makes a lot of sense."

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