ATM charge of the day, Holiday Inn edition
Paul Volcker likes to say that the only worthwhile financial innovation of the past 20 years has been the ATM. So I suppose it was only a matter of time before that, too, was rendered evil.
Here, courtesy of Peter Eavis, is how the ATM at the Holiday Inn in Orlando now works — it doesn’t just charge $3 per withdrawal, but rather the higher of $3 or 3%.
I’ve never heard of anything like this before, although a bit of Googling turns up one page, aimed at ATM owners, saying that “Adult Entertainment clubs” frequently charge a percentage at their ATMs, and that although anybody going down this path “risks losing some transactions”, on the other hand it’s superior to simply capping the maximum withdrawal amount at some low level.
On the web, innovations are frequently found first on porn sites, and then work their way slowly into the mainstream; it seems the same thing is happening here, with strip-club innovations turning up at the Holiday Inn.
ATM operators were forced to display this screen by Sec 205.16 of Gramm-Leach-Bliley, the act which dismantled Glass-Steagal. There’s nothing in the act which caps fees at all, and neither is there anything which prevents ATM operators from charging their surcharge as a percentage rather than a fixed amount. Is this something the Consumer Financial Protection Bureau can look at, now that it has power over non-banks as well as banks? If not, I fear we’ll be seeing more and more of these ever-increasing ATM fees.