Campos urges Bangko Sentral to name banks asking for higher ATM charges

The Bangko Sentral ng Pilipinas (BSP) should name the banks applying for higher Automated Teller Machine (ATM) charges, Makati City Representative Luis Campos Jr. urged on Friday.

The BSP’s Consumer Financial Protection Department could release the names of the applicant banks, the lawmaker noted.

“The banks are bound to be identified anyway, considering that both the House and the Senate are poised to launch separate inquiries,” Campos said in a statement.

On July 19, 2019, the central bank released Memorandum 2019-020 which lifted the moratorium on adjusting ATM fees last imposed on September 27, 2013.

The central bank is now scrutinizing “less than 10” applications for an increase in ATM fees, Deputy Governor Chuchi Fonacier told reporters in an interview at the BSP headquarters in Manila on Wednesday.

Sought for a statement on Friday, Fonacier declined to name the banks citing the limits of her authority, saying it should be coursed through the proper channel.

“I am sorry … but I have no authority to disclose the names of the banks that submitted applications to increase their ATM fees. Thank you for understanding.

“The request for disclosure should be made to the Monetary Board,” she added.

There are actually less than 10 banks seeking regulatory approval to increase the transaction fees every time a customer uses an ATM.

Among the applicants, however, one bank is asking for permission to lower its ATM transaction fees.

“That’s good news. If one big bank can bring down its ATM charge, presumably due to economies of scale, why can’t the rest of the big banks do the same?” Campos noted.

Economies of scale applied to ATM operations means that bigger banks with more machines achieve cost-savings the more their customers use the machine to withdraw or deposit money, inquire about their remaining balance, or even pay their utility bills.

“While it might be understandable for the smaller banks with fewer ATMs to want to raise their fees, it might be harder for the bigger banks to justify their plans to jack up charges,” Campos said.

At present, banks are charging between P10 and P15 per interbank withdrawal, and P2 to P2.50 per interbank balance inquiry, according to the Makati representative.

A number of banks wanted to raise their ATM charges by as much as 50% percent before the BSP ordered a standstill in 2013, Campos noted.

Vicente de Villa III, officer-in-charge of the central bank’s Financial Technology Subsector, said the evaluation process would take about 20 banking days.

“Granted that this would fall under a ‘very scrutinized situation’, it falls under the complex situation (of the Ease of Doing Business) which falls around 20 banking days,” he said at a press conference on Wednesday.

Also on Wednesday, the Department of Trade and Industry led by Secretary Ramon Lopez vowed to fight increases in ATM fees.

According to the Makati lawmaker, the five largest full-service universal private banks, in terms of market capitalization on the Philippine Stock Exchange, are BDO Unibank Inc. (BDO), Bank of the Philippine Islands (BPI), Metropolitan Bank & Trust Co. (Metrobank), Security Bank Corp., and Philippine National Bank (PNB).

The number of ATMs by these banks are as follows:

• BDO – more than 4,000, not counting the 976 ATMs of sister lender China Banking Corp.

• BPI – more than 2,100

• Metrobank – over 2,300, excluding the 575 ATMs of subsidiary Philippine Savings Bank (PSBank)

• Security Bank – 760

• PNB – 1,395

State-owned Land Bank of the Philippines has 2,099 ATMs.

Campos noted that Surigao del Sur Representative Johnny Pimentel wants the BSP to explain why it suddenly decided to lift the moratorium on ATM fee adjustments. —With a report by Ted Cordero/VDs, GMA News