The Case for No-Fee ATMs

By Brian Harris


If you’ve ever spent a night out on the town with Millennials, you’ll find that someone has to use the ATM. That’s the situation I found myself in a few months ago when I was driving two of my friends, and they both asked if I could stop at a specific convenience store that had a surcharge-free ATM.

My friends didn’t make a c-store purchase that day; they were in and out in a flash. But interestingly, they both had the same idea. Given the route we were taking, they knew exactly what c-store they wanted to stop in because of its surcharge-free ATM. They knew the machine was going to be there when they needed it. They trusted it much like they’d trust their bank.

The decision to offer no fee ATMs at your convenience store really comes down to choosing three things over revenue:

  1. Building a relationship with your customer.
  2. Showing customer appreciation.
  3. Increasing foot traffic.

“Relationshipping” is a customer relations term used by Gus Olympidis, president and CEO of Family Express Corp., a 62-store chain based in Indiana.

“We want the customer to rely on us,” Olympidis told Convenience Store Decisions in a recent article. “Because of that, each store features two ATMs to ensure immediate access and some backup in the unlikely event of a breakdown.”

Weigel’s Stores of Tennessee is another c-store chain  that offers no-fee ATMs. Interestingly, the c-store chain is nearly the same size as Family Express, and shares a similar philosophy with an emphasis on customer appreciation. According to Chief Operating Officer Ken McMullen, the philosophy was simple: “Why should our customers have to pay to get their own money? We can give something back to them.”

Olympidis of Family Express advises retailers to be the first in their market to offer surcharge-free ATMs, if possible. McMullen advises retailers to spend money on marketing and getting the word out about the offering.

Ultimately, retailers have to be willing to forego revenue to receive the benefit of increased foot traffic… if the market demands it!

Understand Your Demographics

Really, what’s the sense in offering a free service if no one is going to use it? 

Some retailers interviewed by CSD revealed that their locations weren’t conducive to a surcharge-free ATM—for instance, in a high-rise office building with white collar employees who tend not to use financial services offered in a c-store.

Some retailers choose to pilot ATM programs to test the market response. It’s a wise decision before committing for a full-network rollout. Auditing the results of this test as well as your merchandise sales can also provide guests insights into your operations. Do sales increase when ATM usage is up? Does your product promotion sell better when it’s positioned near an ATM?

Obviously, store reports can help to answer some questions about sales. They may not answer questions about your retail planogram and the relation of your ATMs to the machines, however.

When testing a new service, don’t lose the opportunity to gain additional insights at the store level.

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