Friday, January 16, 2009
Need cash? Just borrow from an ATM
Sometimes you see things you just don't believe, and on those days, thank god for camera phones. The image above is what I saw when I went to withdraw money from a US Bank ATM machine at Cleveland Hopkins International Airport last week.
Look real close at the top option on the left hand side and the bottom two on the right. Can't see them well enough? Try this one:
You're not seeing double: when I told the machine I wanted to make a withdrawal, it asked me if I wanted money from my checking or savings. OK. Or, um, did I want an advance from a credit card? OOOOK. Or, maybe an advance from a credit line? Ummm, no, not that one either.
Alright, then. How about an advance against your next deposit?
I'm not sure how many banks besides US Bank are doing this at their ATMs, or how new this is. I do know I've never seen those options before. But it strikes me as exactly the kind of things consumers should be avoiding and banks should be wary of. Taking an advance against your next deposit from an ATM machine sounds like a close cousin of getting a payday loan. It's certainly a form of borrowing money, and without any vetting or loan application. Just punch in your PIN and go.
I wonder what the terms are: how much interest do you pay on that advance? How long do you have to make a deposit afterward to cover for the advance you took? How much interest are you paying on top of any ATM fees? If US Bank isn't your bank (it isn't mine), do you pay interest or fees to both institutions?
And what happens if you don't pay the money back?