From June 2011,
when withdrawing cash from the ATMs of the banks which are not the issuers of
the clients’ cards, clients will have to pay 5500 dong per transaction instead
of 3300 dong, if the proposal by the members of the Card Association is
approved by the State Bank.

Banks say fee collection is a
necessity

Chair of
the Card Association, which represents some 40 banks, Nguyen Thu Ha said on
Tuoi tre that the tentative raising of the intra-network transaction fee
(holders of the cards of one bank make transactions with ATMs of other banks)
aims to offset a part of the expenses banks have to spend to maintain the ATM
system.

According
to Ha, it is very costly to develop the ATM network. Especially, banks recently
have to spend more money to ensure security for ATMs in the context of
continuous ATM attacks.

Ha said
that in fact, some banks have charged the fee of 5500 dong since late 2010, and
“clients have not made any complaints about the fee”.

She went on
to say that banks are also going to make proposal on collecting fees on
inner-network transactions (card holders make transactions with the ATMs of the
card issuer). This is for the fourth time commercial banks attempt to collect
fees from the transactions of withdrawing money from ATM. The banks proposed to
collect fees three times in the past, but their proposal was refused by the
State Bank.

Trinh
Thuong Thuc, an executive of Vietcombank HCM City Branch, said that with the
fee of 3300 dong per intra-network transaction, banks are incurring loss. In a
talk with local press in September 2010, Thuc said that the expenses banks have
to spend to maintain ATMs have become higher and higher.

In general,
banks have to pay 10 million dong a month to be able to install ATMs on an
advantageous position, and 3-5 million dong on less advantageous positions. Also,
they also have to spend money on transmission line, staff and security
officers. The maintenance fee alone costs 500 million dong per ATM per annum.

The banks,
which have a large ATM network, have to keep the balance of  at least 400-500 million dong per ATM. As for
the banks with thousands of ATMs, the unprofitable sum of money could be
500-600 billion dong.

Besides,
banks believe that the fee collection will help encourage banks to make heavier
investment in installing more ATMs. Currently, many banks issue cards, but they
do not intend to develop the ATM network. As a result, heavy burden has been
put on big banks. An ATM now reportedly serves 2700 card holders.

Banks’ attempt raises strong
opposition

Commercial
banks, while insisting on the permission to collect fees, have also warned,
that if the State Bank does not approve the proposal on fee collection, banks
will stop installing new ATMs. Vietcombank, for example, has planned to install
many more ATMs in 2011, but has halted the plan.

By the end
of 2010, Vietnam
had had 11,700 ATMs, an increase of 20 percent in comparison with the end of
2009.

If banks do
not install new ATMs, this will cause to the overloading of ATMs. Especially,
card holders will have to queue to withdraw money from ATMs at the end of
months or on Tet days.

The attempt
by commercial banks to collect ATM fee has raised a strong opposition on
forums. “Banks should encourage people to open bank accounts and use cards
rather than collecting fees for ATM transactions. This is really an
unreasonable business policy,” HuynhLam wrote on a forum, stressing that card
holders now have to pay many other kinds of fees already, including the annual
fee.

Some
clients have warned that if banks collect fees, people will not use ATMs any
more. If so, the State will fail to encourage non-cash transactions.

In
principle, ATM cards can help ease the burden on banks, because people can make
transactions with ATMs instead of bank officers. If card holders have to pay
fees, they would rather go to bank branches to get money, which will lead to
the overloading, the thing which once occurred in the past.

Ngoc Ha