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Philippines: ‘Go digital to avoid higher ATM fees’
MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) is urging depositors to shift to digital transactions to avoid higher fees charged by banks on ATM withdrawals and balance inquiry transactions.
“In addition to ATMs, customers may also access financial services or perform payment transactions through InstaPay and PESONet. Going digital provides speedy, safe and convenient payment options to consumers, which are available anytime, anywhere,” the BSP said in a statement.
Starting April 7, the banking industry will adopt the acquirer-based ATM fee charging (ABFC) policy, wherein the fees charged to a cardholder for a withdrawal transaction or balance inquiry will be based on the fees of the other banks.
Amid restrictions brought about by the COVID-19 pandemic, the volume of PESONet transfers surged 376 percent to 15.3 million and jumped 188 percent to P951.6 billion in terms of value.
InstaPay transactions likewise surged by 459 percent to 86.7 million and 340 percent in terms of value to P463.4 billion.
The adoption of the ABFC supports the implementation of a more straightforward way of imposing fees as well as enhancements in fee disclosure requirements. It fosters transparent pricing as fees are required to be disclosed to a cardholder before an ATM transaction.
“ATM users will be able to make better, more informed decisions on how and where they wish to transact based on ATM fees posted in the ATM terminals,” the BSP said.
Under the issuer-based charging system, banks charge their cardholders the same ATM fees ranging from P10 to P15 for withdrawal transactions at other ATM terminals.
“With ABFC, a financial institution can set ATM fees for non-customers, while continuing to offer free ATM withdrawal and balance inquiry services to its customers,” the central bank said.
Adjustments in fees charged by banks to non-customers are expected with the adoption of the ABFC. By April 7, ATM withdrawal fees are expected to range from P10 to P18.
The regulator said it would consider reasonable cost for ensuring the reliability and security of ATM services in reviewing and approving all requests for fee adjustments.
“The method is more advantageous to the transacting public as it promotes transparency and empowers consumers to choose the financial institution that satisfies their needs in terms of fees and quality of service,” the BSP said.
The new charging method allows financial institutions that deploy ATMs to be reasonably compensated for servicing non-customers. It also incentivizes banks to set-up more ATM terminals, which widens the reach of banking services in the country.
The BSP noted the costs in providing ATM services including the counting and transporting of cash and loading ATMs, using electricity, providing security and other expenses to operate and maintain the network.
Furthermore, BSP-supervised financial institutions are also required to employ safeguards to ensure that their clients can safely and conveniently use ATMs.
Under the central bank’s three-year digital payments transformation roadmap, BSP Governor Benjamin Diokno has committed to convert 50 percent of the total retail transactions in terms of value and volume to digital channels as part of the shift to a cash-lite economy by 2023.
Source: https://www.philstar.com/business/2021/02/13/2077284/go-digital-avoid-higher-atm-fees