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IN THE KNOW: Interbank ATM fees

07:20 AM August 13, 2019

MANILA, Philippines — In September 2013, the Bangko Sentral ng Pilipinas (BSP) issued a memorandum stopping banks from increasing interbank automated teller machine (ATM) fees.

The memorandum came after several of the country’s largest banks announced plans to increase fees for certain ATM bank transactions.

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Consumers can use ATMs of their so-called mother banks for free. But banks charge those who are not their customers for using their ATMs.

The moratorium on fees was imposed by the BSP amid complaints by ATM users of “unreasonable” fees being charged by certain banks.

The banking industry defended the fees as the price for providing convenience.

In April 2018, the Monetary Board approved the lifting of the moratorium on ATM fees.

Last month, the BSP issued a memorandum reminding banks to charge “reasonable” rates for ATM transactions.

The central bank ordered that the cardholders be provided with appropriate disclosures on fees and charges.

“The amount to be charged to a cardholder should be clearly displayed on the ATM location and on the screen of the ATM terminal,” BSP Deputy Governor Chuchi Fonacier said in a memorandum to banks. “The notice should clearly indicate that the amount displayed is on top of the charges that may be imposed by the card issuer.”

The ATM fee, based on current practice, is set by the issuing bank, and the amount charged to the account cardholders’ remains the same regardless of which other bank the ATM terminal they transact at.

There are 21,682 ATMs around the country provided by BSP-regulated universal, commercial, thrift, rural and cooperative banks as of June.

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Universal and commercial banks charge cardholders of other banks P10 to P15 for every withdrawal from their machines.

In issuing the latest reminder on ATM charges, the central bank said financial institutions may charge rates at their discretion, as long as they are justifiable under prevailing rules.

“While the BSP does not directly intervene in the prices of financial institutions’ products and services as a matter of policy, the [banks] are reminded that it is their responsibility to ensure adherence to the principles of reasonable and market-based pricing,” Fonacier said.

The BSP said banks that want to adjust their ATM fees should file a request with the regulator.—INQUIRER RESEARCH

Sources: Inquirer Archives and BSP website

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TAGS: ATM fees, Bangko Sentral ng Pilipinas, Banking, BSP
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