Banks Not Content With Higher Fees

EghtesadOnline: Electronic banking charges are higher than what customers pay, says the Central Bank of Iran's deputy governor for innovative technologies, elaborating the reasons behind the recent increase in bank fees.

News ID: ۷۵۱۴۰۶

04 November 2020

"Bank service charges in Iran is significantly lower global norms. The CBI last week increased the fees by 20%, though 20% is not enough to cover the wide gap between costs and the fees banks receive," CBI's public relations department quoted Mehran Moharramian as saying on Monday.

The central bank has required banks to charge customers higher fees for their services. The higher rates will come into effect from Nov. 22.

For instance, issuing a debit card costs a bank 120,000 rials, he said, "As of Nov. 22, banks will charge customers  30,000 rials."

Fees approximately account for 10% of banks' annual income in Iran, whereas it is 30% to 50% in other countries, he said.

When asked about possible decline in the number electronic banking services users, Moharramian said, "We did our best to adjust [curb] the increases so that the less-affluent are not burdened." This was the reason behind CBI's decision to stop using fixed rates for money transfers.

As per the CBI announcement, transferring money through ATMs or mobile applications will cost 6,000 rials for transactions up to 10 million rials. Customers will be charged an extra 2,400 rial for transferring every 10 million rials over and above the initial 10 million. ATMs are the most popular in Iran.

Transferring money using PAYA, Iran’s electronic clearing house, and SATNA, internationally known as Real Time Gross Settlement, will cost 0.02% of the transfer amount from Nov. 22.

Fees for checking account balance will be 200 rials, double the current rate. Customers should pay 1,500 rials if they need to check details of the 10 last transactions of their account(s).

Services such as providing cards, issuing guarantee letters, transferring money, granting interest-free loans and opening letters of credit are among the main sources of income for banks.

However, as in the past customers will not pay fees for making payments within the Shaparak Network, the domestic payment network.