As Congress today debates over proposed caps on debit card swipe fees that would limit bank profits and lower costs for merchants, TD Bank has announced they’re going to start charging customers a $2 fee whenever they take cash out of a non-TD bank ATM. That’s going to be on top of any fee that you already pay the ATM. The only way to avoid the fee is to be in a higher-tier checking account.

“TD Bank has been dedicated to expanding our banking channels so customers can bank how, and when they want. The change in the ATM fee structure was necessary, in part, given the current regulatory and competitive banking environment,” a spokesperson told Consumerist.

To avoid the withdrawal fees, you need to either withdraw money from a TD Bank ATM, or be in a “Premiere,” “Relationship” or “Interest” checking account. Premiere requires a $2,500 minimum balance. Relationship requires a $20,000 minimum balance total across all TD Bank accounts.

The changes go into effect March 9.

The move comes as the retail banking industry has essentially killed off “free checking” in response to the restrictions on fees put into place by the CARD Act, and the reduction in profit that would occur if the proposed cap on debit card swipe fees goes into effect.

Banks have limited freebies and introduced a variety of new fees on checking account customers, some of which can be avoided if you meet minimum balance or activity requirements, such as having direct deposit or conducting a minimum number of transactions.

When asked whether TD Bank expected to lose any customers over this, the spokesperson told Consumerist, “Customers value that we offer hassle-free banking, legendary customer service and an extended banking day just to name a few. We believe that this competitive advantage cannot easily be replicated by other banks. Our strength is also in local decision making, local lenders making local loans and developing local relationships. We are still your local bank with the strength and soundness of a triple AAA-rated North American bank. Also, banks do charge other banks a fee for using their ATM network, i.e., TD Bank does pay a fee for a transaction a customer makes at a non-TD Bank ATM. You will find many banks already charge this fee and those who don’t typically don’t have a large network of stores or machines.”

The fees were announced in a new letter sent out to customers, reprinted below.

Send any new bank fees you find to tips@consumerist.com.

(Thanks to abserlock!)

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Chase Isn’t Charging You A Fee, They’re Rewarding You
Chase Kills “Free Checking” For Ex-WaMu Customers

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