Earlier this week, financial authorities such as Bank of Cyprus, issued a ruling officially scaling back on the recently announced controversial bank charges, which corporations and individuals found out about towards the end of last year. In a seemingly hasty move at the time.
Finance Minister and Central Bank Governor, Mr Constantinos Petrides jointly announced jointly following a meeting of the House ethics committee. After the meeting, Mr Herodotou, Governor of the Central Bank of Cyprus a stated that a decree would be issued next week, following a assessment performed by the central bank.
BoC Agree to Mitigate the Charges
The measures not only include a reduction include the following the following actions:
A cap on annual charges for basic bank transactions [as discussed in more depth below].
Some transactions will be unlimited, while there will be a limit on the number a client can conduct within a year for others.
Additional fees to be imposed for exceeding the limit on those transactions.
A proposal to remove all ATM fees for customers withdrawing cash at a different bank to their own.
Mr Petrides said he agreed with the findings and philosophy of the report issued by the central bank, and he would consult with banks. With main opposition MP, stating vulnerable groups of the population and more elderly citizens themselves have been affected by not only the charges at banks but also the overhead reduction costs. These are long-standing clients whose families have been with them since the banks opening.
Are Banks Providing Sufficient Reimbursement?
Even though ATM charges are being abolished, there have been complaints about ATMs being removed from remote areas and the surrounding villages. The government statement expressed the need to ensure ATMs would stay open in the more rural areas, which are remote and so cost the bank to run. However costly, the aging population and ever-growing number of pensioners have to retain easy access to cash.
In light of the increasing charges from the ECB, such amenities are going to be increasingly hard to come by. In the meantime, Green Party MP and head of the party criticised government pace and accused them of stalling progress on the bank charges matter. He said it had been 5 months since Disy had originally filed a complaint about it.
The matter of the bank charges was first discussed last November when the Bank of Cyprus announced an increase on its commissions and charges, relating to services as such as handling the following arguably basic transactions:
Utility bill payments.
In several cases, the charges were set to double – prompting some MPs to liken these to a poll tax on low-income people.
At the time, banks said their goals were to cut costs by promoting their digital platforms; however with the new digipass system being converted for use only as an app if you own a smartphone; legislators said this was penalising the more elderly groups who do not have access to such technology.
The increased fees were originally going to come into force on January 13th, however Bank of Cyprus ultimately postponed the plans following MP and parliamentary pressure.
If you still have any questions or concerns about the recent changes, send us an email, we’d be happy to point you in the right direction of official guidance from the Bank of Cyprus!