ATM Direct Charging
Why is direct charging being introduced?
How will direct charging impact member fees?
Will the direct charge fee be included as part of the member loyalty rebate?
What if you wish to dispute the direct charge?
What if the transaction is declined?
Will members be charged to obtain a balance from an ATM?
How can members avoid the direct charge fee?
Aren’t members worse off because credit unions don’t have many ATMs?
How will members find out about direct charging and the rediATM network?
What is direct charging?
Direct charging will be a charge determined by the ATM owner for a successful transaction conducted at that particular ATM. Currently ATM owners and institutions negotiate fees and charge each other (interchange fees). Interchange fees are no longer permitted. ATM owners must direct charge the customer.
The ATM owner can charge what they like and who they like. They can vary the charge depending on cardholder, locality or time of day if they choose.
Where the ATM owner and the card issuer are the same institution, no direct charge will usually apply as an institution chooses not to direct charge its own customers. So the charge will only usually apply to cardholders that do not bank with the particular ATM owner.
Why is direct charging being introduced?
Seeking to improve competition in payment systems, the Reserve Bank of Australia has required abolition of interchange fees - what participants charge each other for their customers using each other’s ATMs. To ensure pricing transparency and improve competition, financial institutions will have to directly charge ATM users instead of each other. Direct charging will be introduced from March 2009.
Credit Unions have RBA approval to combine their ATMs into one network. This enables members of all participating Credit Unions not to be direct charged for using another credit union’s ATM.
How will direct charging impact member fees?
Unicom Credit Union will no longer apply any transaction fees for members withdrawals using non-rediATMs. Members using other ATMs will be directly charged by the ATM owner.
Will the direct charge fee be included as part of my monthly free withdrawals?
No. The fee is charged directly by the ATM owner and debited to the member’s account on the same day.
What if you wish to dispute the direct charge?
You will be advised of the fee at the ATM before you conduct the withdrawal. You will have an opportunity to stop the transaction. If there is further dispute you will need to take it up with the ATM owner.
What if the transaction is declined?
Members will no longer be charged for declined transactions. One of the RBA’s rules for direct charging is that the current interchange fees charged for declined transactions are no longer permitted.
Will members be charged to obtain a balance from an ATM?
Members may be charged for balance enquiries at non-rediATMs but not at a rediATM.
How can members avoid the direct charge fee?
Easy! Use any rediATM. Even better, get cash with EFTPOS as it’s a cheaper way to withdraw.
Aren’t members worse off because credit unions don’t have many ATMs?
No. Together credit unions have an ATM network currently 1300 strong. This is not as big as some of the bank’s networks, however it is nothing to sneeze at! Credit Unions are looking to invest in building the network to around 2500 ATMs over the next 5 years making it one of the biggest in the country.
This is why the rediATM network has been rebranded to create a stronger presence in the market place so all credit union members can withdraw cash without a direct charge.
There’ll be some nifty tools launched to ensure members can find a rediATM. This includes a rediATM website with an ATM locator. The website will be optimised for mobile phones and PDAs too so no matter where members are they can find the nearest rediATM.
How will members find out about direct charging and the rediATM network?
Credit Unions have developed materials to support promoting direct charging and rediATMs to members, including a new website with a rediATM locator.
