Monetary authorities are optimistic that banks will be encouraged to deploy more automated teller machines (ATMs) as a new fee charging model that allows some leeway on fees takes effect.
Under the acquirer-based fee charging (ABFC), which took effect on Wednesday, April 7, ATM owners can set the fees they want to charge cardholders of other banks who use their machines.
However, Bangko Sentral ng Pilipinas (BSP) governor Benjamin Diokno said ATM transactions using the machines of cardholders’ banks remain free of charge.
“By allowing ATM owners to set the fee, they can be encouraged to place ATM terminals in the provinces since they will now be adequately compensated,” he told journalists in a virtual briefing Thursday, April 8.
Under the new system, ATM withdrawal fee ranges from P10-P18 per transaction while balance inquiry fee ranges from zero to P2.50 per transaction.
BSP executives said most banks increased their fees under the new system.
While this system seems to be an additional burden to the cardholders who do not have access to their banks’ ATMs, Diokno said this is beneficial to the banking public in the long run.
He said bulk or 34 percent of ATMs in the country are in the National Capital Region (NCR), 13 percent are in Region 4-A, and between 0 to 8 percent in the other regions.
With the ABFC, BSP executives expect the deployment of ATMs in more areas around the country, which is expected to boost the central bank’s financial inclusion agenda.
Diokno said ATM transactions fell from around 100 million in end-2019 to about 73.6 million in the first half of 2020. “However, withdrawals regained its volume by year-end 2020 to about 94.2 million as lockdown restrictions were relaxed,” he said.
Diokno said a drop was again noted in the first quarter of this year. “This behavior may be considered normal as may be considered in previous years. Nonetheless, data show that InstaPay transactions continue to increase,” he said, referring to one of the two electronic fund transfer services under the BSP’s national retail payment system (NRPS).
Meanwhile, Diokno said BSP’s policy-making Monetary Board (MB) has approved the retention of the current ceilings on credit card transactions.
The maximum interest rate or finance charge on unpaid outstanding credit card balance remains at 24 percent per annum or 2 percent per month, the maximum monthly add-on rate for credit card installment loans is up to 1 percent, and the maximum processing fee for credit card cash advances is P200 per transaction.
“The retention of the ceilings is in keeping with the low interest rate environment,” Diokno said, adding BSP continues to monitor the impact of these ceilings on credit card operations amid the pandemic. — Joann Villanueva (PNA)