ATM fees are at a record high, a new survey finds. Here’s why.

Cash withdrawals from ATMs are becoming more expensive, with fees hitting record highs in the United States. According to a recent survey conducted by Bankrate.com, Americans are now paying an average of $4.86 for out-of-network ATM withdrawals, marking a 1.9% increase from the previous year’s average of $4.77. This is the highest fee recorded since Bankrate began tracking ATM fees 27 years ago.

The rising costs can be attributed to a combination of charges from both ATM owners and banks. Cash machine providers charge an average of $3.22 per transaction, while banks charge an average of $1.64, which is a 3.8% increase from 2024. In certain metropolitan areas, average combined fees can exceed $5 per withdrawal.

Bankrate surveyed 10 banks and financial institutions in 25 of the largest metro areas in the U.S. Atlanta emerged as the city with the highest ATM costs, with an average out-of-network fee of $5.37. Following closely behind are Phoenix and San Diego, where ATM charges average $5.35 and $5.31, respectively. On the other hand, Boston and Seattle had the lowest average rates among the surveyed metro areas, at $4.37 and $4.42, respectively.

Financial analyst Stephen Kates pointed out that while there have been discussions about regulating overdraft fees, there are no limits on how much banks can charge for ATM withdrawals. This lack of regulation gives banks the freedom to increase fees without the risk of losing customers, especially for out-of-network transactions. The shift towards digital payments and online banking has also reduced the need for cash and traditional ATMs.

To avoid high ATM fees, consumers can consider alternatives such as getting cash back at local stores or using banking apps to locate nearby in-network ATMs. For those who frequently need to withdraw cash from out-of-network ATMs, switching to a bank that offers fee reimbursements, such as online financial services like Fidelity, could be a more cost-effective solution.

In conclusion, while cash payments remain a primary form of transaction for many Americans, the increasing costs associated with ATM withdrawals highlight the importance of exploring alternative banking options and strategies to minimize fees. By staying informed and proactive, consumers can navigate the evolving landscape of financial services and make more informed decisions to manage their finances effectively.