INTRODUCTION TO THE SYMPOSIUM ON THE COMPETITIVE AND WELFARE IMPACTS OF ATM FEES

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ATM fees have been a source of controversyin many countries. These fees include (a) ‘interchange fees’ that banks charge each other when one bank's customer uses another's ATM, (b) ‘foreign fees’ that banks charge their own customers for using other banks' ATM's, and (c) ‘surcharges’ that banks charge other banks' customers for using their ATM's. In some countries, a single ATM transaction potentially involves all of these: when a customer of bank A withdraws money using bank B's ATM, the customer could pay a foreign fee to bank A and a surcharge to bank B, and bank A could pay an interchange fee to bank B. A central issue surrounding these fees is whether they decrease consumer surplus by allowing imperfectly-competitive banks to extract rents, or increase it by promoting competition for depositors through account fees or ATM deployment.