Sunday, July 17, 2005

Lawmaker questions impact of ATM linkup

Rep. Joseph Santiago has challenged the banking industry and the Bangko Sentral ng Pilipinas (BSP) on the much-publicized interconnection of the country’s three largest bank automated teller machine (ATM) networks.

"We welcome the interconnection of the ATM networks since it will provide consumers universal access. But apart from this, what will the linkup really mean to the ATM user? Will it translate to reduced transaction charges? Or will it mean even more (interconnection) charges?" Santiago said.

"What is foremost in the mind of the ordinary consumers is lower ATM charges. Consumers are entitled to know how the interconnection will affect their pockets. This is the bottom line," Santiago pointed out.

Last week, Megalink Inc., Bancnet Inc. and Expressnet Inc. forged a three-way interconnection agreement.

The linkup would give the country’s 16.4 million ATM cardholders total access to 6,000 machines nationwide.

A recent study showed that banks charge ATM fees ranging from P7 to P10.80 per transaction once a depositor uses a machine not owned by his or her own bank. Some banks even charge at least P2 for each ATM withdrawal made by their own clients.

The ATM charges are on top of monthly service fees of P55 to P300 imposed by banks on accounts with minimum average daily balances that fall below a required amount ranging from P500 to P3,000.

Santiago described prevailing ATM fees as "burdensome and excessive."

"Consumers not only want lower ATM charges, but also absolute transparency from banks insofar as the fees are concerned," Santiago said.

"Instead of a simple interconnection of their facilities, the BSP should compel the three networks to consolidate their operations through a merger so that the cost-savings realized will immediately translate to lower ATM charges," Santiago added.

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