Selasa, Januari 04, 2005

Fomca: Halt monopolistic moves by banks

Claudia Theophilus
The government must ensure that banking services are managed in a just and fair manner so that the financial services sector can compete globally, said the Federation of Malaysian Consumers Association (Fomca).

In a memorandum to Prime Minister Abdullah Ahmad Badawi dated Dec 6, it urged Bank Negara Malaysia to control profit-making activities by financial institutions.

For a start, Fomca wants a stop to all proposals for service charges for non-banking transactions and to gradually lower the other service charges, so that banks offer innovative services that generate revenue and increase efficiency.

The five-page document was in response to thea public outcry against arbitrary charges levied by local banks, which had prompted the DAP to send a protest memorandum to Bank Negara last week.

Maybank, the largest banking group, will levy a RM12 annual fee to access its online services come Dec 20.

The central bank responded by announcing plans to implement guidelines to cap banking service charges beginning Feb 1. DAP secretary-general Lim Guan Eng has questioned the delay.

Fomca secretary-general Muhammad Sha’ani Abdullah said Bank Negara is responsible for monitoring decisions of banks that are inefficient, discriminatory and monopolistic in nature.

He said electronic and Internet banking has become the basic platform for all commercial transactions.

“The introduction of Internet banking as a free service, in addition to receiving wide support from customers, has also reduced investment, operational and labour costs,” he said in the memorandum.

“It reduces traffic congestion for banking business, loss of man-hours, cost of transfer of funds and banking infrastructure costs in rural areas; simplifies bill payments; reduces risks of theft and robbery; and improves the quality of life by reducing stress.”

Purpose defeated

On the 50 sen charge by Maybank for every withdrawal exceeding four times per month, Muhammad Sha’ani said it may be one way of forcing customers to use online banking for payments and transfers.

“But can the bank promise excellent service throughout? Lower service charges would compel banks to increase efficiency and enhance their services in order to remain competitive.”

He cited the example of an ATM having insufficient funds to enable withdrawal of RM4,000 twice and the number of withdrawals required if only RM10 notes are available, and how much the transaction would cost in relation to the service fee.

“When payments at point-of-sale and via e-Pos fail, customers are forced to withdraw from the ATM for the purpose of trade,” he explained.

He noted that some banks have stopped providing passbooks, forcing people to use the ATM for cash withdrawals, making it difficult for them to check the balance or identify the account holder in an offline situation.

Muhammmad Sha’ani said the RM2 charge for all inter-bank funds transfer is expensive because the commission on a cheque is a minimum 50 sen or a maximum of 0.5 percent of the value transferred.

“Lower charges should be imposed for Internet banking transactions, similar to developments in the securities trading sector and commission for airline ticketing agents.”

On the RM1 charge per withdrawal at another bank’s ATM, he said, only serves to reduce the efficiency and competitiveness of the banks.

“The reduced number of branches following the bank mergers has led to the duplication of banking infrastructure. All banks should try to increase the facilities at strategic locations and share the infrastructure wisely,” he added.

He also noted that banks force traders, merchants and organisations who need the merchant account facility to record high monthly sales.

“This burdens them while banks chase unreasonable profits for every facility they offer, setting aside the social responsibility to expand their services to all parts of the country.”

Muhammad Sha’ani said some banks impose a service charge for current accounts that discriminate against customers with a low account balance.

“Banks should provide incentives to encourage higher savings,” he said, suggesting an annual service charge of RM10 for current accounts as one way of encouraging higher savings.

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