There is no reason for any bank in Malaysia to charge the RM1 fee for interbank Automated Teller Machine (ATM) cash withdrawal transactions as many, if not all Malaysian banks have gained substantial cost savings through service automation and digitalisation, said Stampin MP Chong Chieng Jen in an interview today.
“Many banking services which have been automated have generated greater cost savings for each bank. As these banks have reduced their costs — for example, by reducing staff at counters and as lesser space is needed now for a bank to function — these cost savings can be used to absorb the ATM charge,” said Chong on the recent calls made for the abolishment of the fee imposed on all Malaysians.
“It’s then absurd that consumers have to bear the additional RM1 ATM fee over and above each bank’s gains (refer to the statement from NUBE).
“No Malaysian consumer should be allowed to pay for large-scale profitability gained by these banks as it then becomes a burden to the consumer, more so adding a financial strain on low-income earners, particularly those from the B40 and M40 groups who reportedly make up 85% Malaysia’s population.
Chong, who is also Sarawak Democratic Action Party (DAP) chairman, said; “Simply, as the banks gain substantial cost savings due to service automation and with the use of many banking technological advancements, the consumers cannot be burdened with further charges after the fact that these banks earn huge profits. This makes the fee baseless.
He added, any additional costs incurred to operate the ATM network must then be borne by these banks as he believes the costs savings can continue to be used for maintenance and other costs incurred.
The National Union of Bank Employees of Malaysia (NUBE), who have urged the Malaysian government to abolish the fee since December last year, said Payments Network Malaysia Sdn Bhd (PayNet), which imposes the fee, is a major player in the country’s financial infrastructure, with Bank Negara Malaysia (BNM) as its largest shareholder, alongside 11 other banks. PayNet generated RM544 million in revenue and RM271 million in profit from this fee in 2023, while the fee disproportionately impacts low-income Malaysians, particularly those in the B40 and M40 income groups.
NUBE General Secretary J. Solomon recently said: “Who gets how much of the RM1 levy at the ATM is determined by the shareholding within PayNet. BNM owns 35.5% of the payments network company, or nearly 36%. Another 64.5%, or almost 65%, is held by 11 commercial banks that account for the balance of PayNet’s shareholders. They comprise Maybank, CIMB, RHB, Public Bank, AmBank, Hong Leong, Affin, Alliance, Bank Islam, Bank Muamalat and Bank Kerjasama Rakyat Malaysia.
“What BNM is doing isn’t just wrong; it’s “criminal”.
Information obtained from the Companies Commission of Malaysia (refer to the tables presented in the statement) showed that as of Oct 3, 2024, Bank Negara Malaysia held 26,895,534 shares in PayNet while the 11 commercial banks owned 4,434,558 shares each (see accompanying table). Percentage wise, the central bank’s stake of 35.5% is six times that of the average commercial bank, which owns 5.86% of PayNet.
“This profit is being made on the backs of the poor working class,” J. Solomon, general secretary of NUBE said, adding, “And Bank Negara is a party to this. Where is the justice as Malaysians who own a bank accounts have been rendered defenseless against the excesses of the banking system as the agency mandated to protect them — the central bank — “which is prioritising profit over public.”
In theory, the numbers add to the already healthy bottom line of the Malaysian banking industry, with the 11 commercial banks owning PayNet declaring net profit running into the hundreds of millions — in some cases, billions — for 2023.
PayNet said earlier: “Surplus profits are instead re-invested to ensure that the nation’s financial market infrastructures and payment ecosystems are resilient, competitive and accessible to all.”
Meanwhile, PayNet Group CEO Farhan Ahmad during an interview with Astro Awani on Aug 24, 2024 said: “In 2023, (PayNet) processed RM5.15 trillion in transactions—3.3 times Malaysia’s Real GDP.
Malaysians are called upon to support NUBE’s #HapusCajRM1 campaign to do away with the RM1 ATM fee by signing the online petition at Change.org’s and on NUBE’s official website to sign the petition.
#HapusCajRM1
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