Caution over using third party ATMs

Brands spend millions in an attempt to get consumers to associate certain colours and logos with their brands, instantly.

Bank customers on the lookout for their bank’s ATMs for example, scan public places for the colour of their bank – blue for Standard, green for Nedbank, turquoise for FNB and red for Absa.

That’s because transacting at an ATM other than that of your bank costs a lot more because of the inter-bank Saswitch fee which applies.

A third category of ATMs has thrown a spanner in the works.

Some years ago a number of banks, including Absa, began partnering with third parties – independent ATM operators – to extend their network of ATMs in convenient locations such as service stations.

The bank charges its customers a premium transaction fee, to cover the extra cost of providing the service through a third party.

The South African payment system does not allow non-banks to participate in the payment system without the sponsorship of a registered bank, so the “sponsoring bank’s” logo has to appear on the signage.

All of which brings me to Ahmed Docrat’s case.

Like many of us, his bank “package” includes a number of free ATM withdrawals every month, as long as he uses Absa ATMs.

The ATM at the Engen service station at Durban’s 45th Cutting (eastbound) used to have a fully-fledged Absa ATM, which Docrat used regularly.

He didn’t notice that the ATM had become a “supported by Absa” one, because the Absa logo remained on the site’s external advertising pillar.

That is until he had a good look at his bank statements earlier this month and realised that he was being charged for his withdrawals from that ATM – R24 for a R1 500 withdrawal, for example.

He wasn’t happy about that at all.

“It’s very misleading to Absa customers, considering that the garage as well as the ATM itself has prominent Absa branding,” Docrat said.

“Could you advise if I have some basis to ask for a refund of these charges, and if there have been any similar complaints.”

Docrat is by no means the first Absa customer to have missed the significance of the “supported by” signage. I vaguely remembered a similar case going before the Advertising Standards Authority (ASA) so I looked it up.

Back in 2006, the ASA directorate, ruling on a complaint, concluded that Absa’s prominent logo on a “Supported by Absa” ATM, combined with the colour red, created the impression that the ATM belonged to Absa.

Absa, however, argued that the words “Supported by Absa” served to correct any misleading impression that might be created in the customer’s mind.

The upshot of that case was that Absa agreed that by the end of March 2006, a rolling screen message would be placed on all Absa-supported ATMs, reading: “Absa customers: This cash express ATM is independently operated and is supported by Absa. An additional convenience fee is charged, which is less than the normal Saswitch fee.”

Plus, a similar sign would be placed on the ATMs.

But, as I explained in an e-mail to Absa about Docrat’s case, neither the physical warning nor the rolling one were on the ATM in question, and the sign outside was a “proper” Absa one.

Responding, Absa’s head of payments and digital channels, Adrian Vermooten, said in the process of converting the fully-fledged Absa ATM to a third party CashExpress one, “it appears that they did not change the signage outside the service station itself”.

“We have taken immediate remedial action and the Absa signage has been removed.

“We regret the error and have requested the third-party ATM supplier to provide us with an assurance that none of their sites carry the full Absa branding.”

The independent ATM supplier is responsible for maintaining the “visual identity” of its ATMs, in keeping with that ASA ruling, Vermooten said.

“The independent supplier has advised that, due to a site installation error, this site did not make use of the correct signage. The supplier has confirmed that the signage has been replaced with immediate effect. In protecting our Absa customers, we have requested that the third party provides written confirmation that all their sites display the correct message.”

Vermooten said Absa had been under the impression that the third party had complied with the ASA requirements, and had they done so, “Mr Docrat would have been in a position to make a more informed decision about whether or not he wanted to conduct a transaction at this particular ATM”.

Absa advises its customers about the pricing significance of the “Absa supported” ATMs in online and printing brochures, he said.

There was no mention in that response of a refund of Docrat’s withdrawal fees, so I queried that, and was told that the third party ATM operator had agreed to refund Docrat’s fees.

Bottom line: if you see the words “supported by” on an ATM which features your bank’s logo, know that you are going to pay extra fees. - Pretoria News