Warning of hike in ATM charges

CHARGES for ATM withdrawals will rise almost tenfold if independent providers are allowed into the market, Director of Consumer Affairs Carmel Foley warns.

Ms Foley revealed last night that her office has already been contacted by up to 10 independent ATM network providers seeking to locate cash points in varied locations such as pubs, hotels and shopping centres. Banks are allowed to charge a maximum of 22% per ATM withdrawal and are regulated by the Director of Consumer Affairs. But the independent ATM providers argue that as they are not financial institutions the director has no legal power to control their charges.

"They have been trying to come into Ireland and they would seek to charge in the region of 1.50 to 2 per withdrawal," Ms Foley said, adding that her office was currently in a legal stand-off with several of these companies.

"We say they have to be regulated by us and they say they are not financial institutions so we have no power over them. We are currently in a stand-off. For them to come in and say they can just charge what they like is not on," she said. Ms Foley said one of the companies pushing hard to enter the market was the British-based Moneybox Corporation. According to the company's website, Moneybox has installed more than 1,300 ATM machines in Britain and is planning a further 3,000. The company has also expanded to several other European countries. Moneybox could not be contacted for comment last night.

Ms Foley called on Irish banks to provide more ATM machines and said her office was strongly opposed to independent operators. She added that banks stood to receive a share of the profits made by any independent operator because the companies can not provide an ATM network without the co-operation of domestic banks. "Given that banks are trying to keep customers away from their branches through the use of electronic banking, I would feel the existing banks ought to be putting enough of an ATM and Laser card network in place so customers can make withdrawals at a cheaper rate," she said. Ireland has one of the highest levels of ATM usages and one of the lowest densities of bank branches and ATMs in Europe, giving further significance to the prospect of independent companies setting up ATM services. Furthermore, in the 1990s, banks have had the highest return on assets than any other banks of all EU nations. They are nearly three times more profitable than German banks, and 11 times more profitable than French banks.