UBS is raising its credit card and prepaid card fees for cash advances at ATMs. Until now, the cost of getting a cash advance in Switzerland was the greater of 3.5 percent or 5 francs.
From July 15, 2015, cash advances at ATMs both in Switzerland and abroad are subject to a cash advance fee of 4% with a hefty minimum fee of 10 francs.
Example: If you withdraw 250 francs from an ATM with your UBS credit card or prepaid card, you will be charged 10 francs. If you get 50 francs at an ATM, the 10-franc minimum fee comes to 20% of the cash advance.
The 4% cash advance fee kicks in for withdrawals above 250 francs. If you get 500 francs at an ATM, you will pay a 20-franc fee.
UBS justifies the new fees by citing the increase in services provided, including online and mobile services and credit card insurance benefits.
Credit card fee hikes are a regular occurrence among Swiss credit card issuers. Rather than raising the annual card fee, which would be obvious to cardholders, many issuers quietly raise fees attached credit card transactions. Typically, these include foreign transaction fees, currency exchange rate markups, cash advance fees and APRs.
Because of this, regularly comparing costs using an independent comparison tool can save you a lot of money. moneyland.ch provides the most comprehensive Swiss credit card comparison tool, which accounts for and clearly breaks down all important card fees.
Important: Regardless of which credit card you use, you should never use your credit card to get cash at ATMs because cash advance fees and cash advance APRs are exorbitant. The debit card attached to your checking account (Maestro, V-Pay, PostFinance Visa Plus) provides a much cheaper way to make cash withdrawals. Your credit card, on the other hand, is best reserved for direct purchases from conventional or online merchants.
Why are credit card fees for cash advances so high? Probably because credit card companies want consumers to use the credit card services which they control and profit from in place of cash. For this reason, they have no commercial interest in providing you with cash at a reasonable cost.
It is very likely that new and often hidden fees and charges will continue to be added to various credit cards at the cost of consumers.
To justify their high fees and charges, credit card processors point to regulations lowering the interchange fees which they charge to merchants, or to added card benefits. Estimates indicate that new regulations will cost credit card issuers, as a whole, between 50 to 60 million francs annually from 2017 onwards.
The possibility of the maximum legal APR for Swiss credit cards being lowered from 15% to 10% in 2016 would come as another blow to the credit card industry, and issuers may choose to impose higher fees on cardholders to maintain their profits.
More on this topic:
Unbiased Swiss credit card comparison
Personal loans: new maximum interest rates
Prepaid cards in Switzerland
UBS credit cards
Deal of the Day 
