Bank clients urged to use own ATM network

MANILA, Philippines — Banks urged clients to transact through the ATM network of their respective banks to avoid charges for withdrawal and balance inquiry transactions under the new charging method starting April 7, according to the Bankers Association of the Philippines (BAP).

In an advisory, Benjamin Castillo, managing director at BAP, said cardholders who continue to transact through the ATMs of their respective bank would continue to enjoy free services.

“Cardholders who choose to transact using an ATM of another bank will still have an option to proceed or not to proceed with his transaction mindful of the ATM fee that will be charged,” Castillo said.

In April 2018, the BSP lifted a moratorium on ATM fees imposed in September 2013 under Memorandum M-2013-044 that maintained a status quo in terms of both service fees and connectivity arrangements.

The regulator issued Memorandum 2019-020 in July 2019 calling for the adoption of an acquirer-based charging method, wherein the amount to be charged to a cardholder shall vary depending on the ATM terminal being used.

The new method allows ATM owners to directly compete for business with one another by disclosing fees and offering lower charges than other ATMs in the vicinity.

It also reminded BSP-supervised financial institutions (BSFIs) to adhere to the principles of reasonable and market-based pricing in setting their ATM fees.

“We are appreciative of the BSP’s move to adopt this pricing philosophy that is market driven and customer-centered. This policy promotes competition and efficiency in the banks’ effort to deliver better services to the banking public,” Castillo said.

Under the current issuer-based charging method, ATM fees charged by banks range between P11 and P15 per withdrawal transaction on their clients, but the fees only apply if a bank client uses an ATM that is not owned by his or her bank.

Several banks already issued their respective advisories on the new fees for ATM withdrawal and balance inquiry transactions to non-bank clients starting April 7.

The country’s biggest banks led by Sy-led BDO Unibank Inc., Ty-led Metropolitan Bank & Trust Co. and Philippine Savings Bank, Ayala-led Bank of the Philippine Islands, Aboitiz-led Union Bank of the Philippines are set to charge non-bank clients P18 per ATM cash withdrawal and P2 per balance inquiry transaction.

Charges to be imposed by other banks on non-bank clients using their ATM network would vary such as   Rizal Commercial Bank Corp. at P10 to P18 per withdrawal,   China Bank and China Savings Bank at P16, Philippine National Bank  at P15, as well as state-run Development Bank of the Philippines at P15.

The imposition of higher fees is necessary in order for banks to continue providing ATM services since establishing a network entails massive investments.

The BSP has noted a sharp decline in ATM transactions as the country imposed one of the longest and strictest lockdowns in the world to slow the spread of the pandemic.

On the other hand, digital transactions such as cash fund transfers through PESONet and InstaPay soared last year due to mobility restrictions

BSP Governor Benjamin Diokno has committed to raise the share of digital transactions in terms of value and volume to 50 percent to transform the country into a cash-lite economy by 2023 and a coinless society by 2025.