Commonwealth Bank, NAB, ANZ, Westpac ditch ATM withdrawal fees

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Customers withdraw money from National Australia Bank (NAB) Automatic Teller Machines (ATMs) in central Sydney, Australia, July 24, 2015. Reuters/David Gray

NAB, ANZ and Westpac has followed Commonwealth Bank's lead and axed ATM withdrawal fees. The latest move by Australia's big banks can save customers hundreds of millions of dollars.

All of the biggest banks in the country have decided to no longer charge customers of other banks a $2 fee to withdraw cash from their ATMs. Commonwealth Bank was the first on Sunday to announce its decision to remove the fee, citing consumer unhappiness.

Commonwealth Bank’s group executive of retail banking services Matt Comyn said they think the change will benefit many Aussies. He said the bank hopes the move would demonstrate its willingness to listen and act on customer feedback.

The other three big banks followed suit later that day. Andrew Hagger, NAB’s chief customer officer of consumer banking and wealth, stated that all Aussies will be able to use ATMs without being charged with a cash withdrawal fee regardless of their bank.

The ANZ group executive Fred Ohlsson also had a similar announcement, saying the fee is slated to be dropped on its more than 2,300 machines starting next month. “While we had been actively working on how we provide fee-free ATMs for our customers, we have decided to remove these fees all together from October,” The Guardian quotes him as saying.

George Frazis, Westpac consumer group executive, said the bank’s latest move will apply to its St George, Bank of Melbourne and BankSA customers. It will benefit customers in rural and regional areas.

Frazis said Westpac wants all Aussies, regardless if they are Westpac Group customers or not, to benefit from one of Australia’s largest ATM networks. The foreign ATM fee, according to him, has been “deeply unpopular” with consumers.

Scott Morrison has welcomed the decision. “It is important that we continue to take action right across the full suite of issues that are needed to ensure that our banking system is stronger, is fairer, is more accountable, and is more competitive,” he said.

The government minister Greg Hunt praises the decision, saying it is good for consumers. He described Commonwealth Bank’s announcement as a competitive lead and urged other banks to follow suit.

Based on Reserve Bank of Australia data, Aussies made over 250 million ATM withdrawals from banks other than their own last year. Consumer group Choice told News Corp the move will put pressure on other banks to also get rid of unpopular fees.