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Tuesday, May 21, 2024

Warning of Potential ATM Cash Withdrawal Charges


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Consumer watchdogs have issued a warning that unregulated owners of numerous ATMs across the country may soon impose fees for cash withdrawals. In 2021, both Bank of Ireland and AIB sold a combined total of 1,200 ATMs to independent operators. At the time of the sales, assurances were made that these new independent owners would not introduce additional charges for cash withdrawals for a three-year period. However, this grace period is set to expire at the beginning of the upcoming year.

Concerns of Additional Charges

Michael Kilcoyne, Chairman of the Consumers’ Association of Ireland lobby group, expressed concern that independent ATM operators might now decide to implement charges, potentially ranging from €1 to €3 per cash withdrawal, on top of existing bank fees.

The Call for Regulation

Kilcoyne emphasized the urgent need for independent ATM operators to be regulated by the Central Bank. While changes to charges and fees imposed by banks on customers for using current accounts require Central Bank approval, there is currently no regulatory framework for independent ATM operators.

Background on Sales and Moratorium

In early 2020, AIB sold its network of over 500 non-branch ATMs to the global cash management corporation Brink’s. Part of the sales agreement included a three-year moratorium on charging for withdrawals.

Similarly, in December of the same year, Bank of Ireland sold 700 non-branch ATMs to the US-based electronic payment services group Euronet, with a three-year agreement in place that prevented Euronet from raising withdrawal fees. However, both of these grace periods are now expiring.

Location and Extent of Independent Operators

The ATMs sold by AIB and Bank of Ireland are predominantly located in retail outlets. Independent operators also have hundreds of other ATMs apart from the ones acquired from the banks.

Regulatory Recommendations

The ‘Retail Banking Review,’ commissioned by the Department of Finance and published in November, recommended that independent ATM operators and cash-in-transit firms should be regulated. It highlighted the critical role these entities play in the distribution of cash across the country and noted that they currently operate without Central Bank authorization or supervision.

Government Commitment to Regulation

Finance Minister Michael McGrath has pledged to introduce legislation to regulate independent ATM operators and cash-in-transit firms. The Department of Finance is currently engaged in discussions with the Central Bank and industry stakeholders, including ATM operators and CIT companies, to determine the appropriate level of regulation for these entities.

Efforts to obtain comments from Brink’s and Euronet regarding this matter were made but yielded no response.

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