New Report Focuses on Decreasing ATM Fees and Increasing Access


EBT Report cover

The California Reinvestment Coalition (CRC), a nonprofit, released a new report earlier this month focused on the ATM fees charged to people in order to access their public benefits in California and how that can be improved.  (In a 2014 report, CRC detailed how public benefit recipients in California pay $19 million a year in ATM fees to access their benefits.)

“During the past several years, we’ve worked with a coalition of committed advocates to understand how and why millions of dollars in public benefits were being diverted to ATM fees,” explains Andrea Luquetta-Kern, deputy director at CRC and the author of the new report.

“After hearing from our coalition and from consumers about these outrageous costs, the state of California took steps to address this problem.The state’s new EBT (Electronic Benefit Transfer) services contract that will start in 2018 promises to more than double access to free ATMs for public assistance recipients by providing free withdrawals through at least two major ATM networks, including at all Bank of America ATMs throughout California.”

Findings from the report, which is based on focus groups, interviews, and research by CRC:

Californians are interested in having their benefits directly deposited into a bank account, and like the idea of using a debit card instead of an EBT card because of the reduced costs, ease of use, and less stigma.

However, many recipients have deep mistrust of bank fees, fear government over-reach once they granted access to their personal bank accounts to make deposits, and need more certainty about the process and length of time it could take to set up direct deposit.

In response, CRC recommends that social services agencies statewide:

1. Ensure access to safe, affordable bank accounts such as those that will not overdraft and meet CRC’s SafeMoney standards or national Bank On standards.
2. Provide a transparent and efficient process for setting up direct deposit after first ensuring that families who need access to cash aid immediately are provided with functioning EBT cards on the same day as program enrollment.
3. Build trust by educating aid recipients on their privacy rights, including that county agencies will not and legally cannot peer into personal bank account activity or directly confiscate aid already deposited into accounts.
4. Keep direct deposit as a choice, not a requirement that families can opt for as their needs and preferences dictate.