Banks want to boost ATM fees

People withdraw cash from Vietcombank ATMs in Ha Noi. Six major banks – Agribank, Vietinbank, Vietcombank, Dong A Bank, BIDV and Techcombank – own 8,200 ATMs, accounting for 70 per cent of the total nationwide. — VNS Photo Truong Vi

HCM CITY — Banks want to raise fees on per inter-bank ATM transaction from VND3,300 to VND5,500 in order to make up for major bank losses incurred by sharing card services with small banks.

The State Bank of Viet Nam has given the green light to banks to charge fees on all internal ATM transactions beginning in 2013.

However, many major banks also want the central bank to increase fees on inter-bank ATM transactions.

The head of a major bank's transaction office in HCM City, who declined to be named, said it was necessary to increase fees on inter-bank ATM transactions because the costs for building and operating facilities for ATMs reached hundreds of millions of dong.

Expenses include the purchase of ATMs, installations and rental of space.

ATM owners also have to pay millions of dong to operate the machines per month, including payments for space rental, security fees and electricity charges.

"This is the reason why many small banks do not have enough money to build many ATMs, although they have issued so many cards. Consequently, cardholders of small banks have to use ATMs of major banks to carry out their transactions," he told Tuoi Tre newspaper.

One bank has issued 80,642 cards, but built only 20 ATMs, while another has issued 64,277 cards but has only 10 machines.

With the current fee of VND3,300 fixed per inter-bank transaction, the money is not enough for ATM owners to cover additional services if they have to serve thousands of cardholders from other banks, according to independent market watchdogs.

According to figures from the Smartlink Card Service Joint-Stock Company, by late 2011 Viet Nam had around 15,000 ATMs, with nearly 40 million ATM cards in usage, resulting in total transactions worth US$32 million.

At present, only six major banks, Agribank, Vietinbank, Vietcombank, Dong A, BIDV and Techcombank, own 8,200 ATMs, accounting for 70 per cent of the total.

However, most banks have not earned profits from card services.

Phi Thi Phuong, head of the card-service office of the Export – Import Joint Stock Commercial Bank (Eximbank), said the bank had installed 300 ATMs in the last 10 years but had not made any profit from this kind of service.

Phuong told the Viet Nam News Agency that all banks, however, were still providing card services because benefits were expected in the future, particularly in retail sales.

The deputy director of another major bank in Ha Noi said that major banks could not support small banks'use of ATMs any longer.

Small banks should invest more to build their own ATMs, or increase fees for inter-banks ATM transactions, he added. — VNS