The hidden ATM costs everyone should know about
ATMs are great when we're at home. They're convenient, quick and we know where to find the ones that don't charge us fees.
ATMs are not so great when we're abroad. They're a pain to find, they reject our card for no reason, and they can be dangerous at night. But worst of all, they don't tell us how much they are charging us – fees and exchange rates are rarely fully disclosed.
You generally have to pay four separate fees:
- The local ATM fee (ATMs should generally tell you this, but they don't always)
- Your bank's foreign usage fee (this is usually a fixed fee, so small withdrawals work out really expensive)
- Your bank's currency conversion fee (this is a percentage, typically 2-3% but it can be as high as 4%)
- The fee hidden in the exchange rate (even the official rates from Visa/MasterCard include a fee compared to the "pure" exchange rate)
So what's the total cost, you ask?
It varies depending on where you are, which ATM you use, who you bank with. Bizarrely in Japan, fees can also vary depending on the time of day!
Our estimate for the global average is $7.50 for withdrawing $100 USD (which includes a $2 local fee, $3 foreign usage fee, and $2.50 for currency exchange).
$7.50 would buy you a decent dinner in most parts of the world – that's real money.
You can save a bit by withdrawing large amounts each time you use an ATM. But that's not particularly safe, and it's much easier to go well over budget without noticing.
This is just one of the areas we're trying to fix with Tab – we'd like to make booking and payments as simple and low-cost as possible.
Banner Image courtesy of Paul Arps