As Brussels prepares to impose a limit on fees paid by business customers to their banks for processing electronic payments the head of the Portuguese Association of Banks, Faria de Oliveira, said today that banks may simply charge their customers to withdraw cash from the ATM network.
Anything that puts banking costs up will impact on profitability, so revenue will have to be obtained from another route, commented Faria de Oliveira, guaranteeing himself even fewer fans from the general banking public who will see little correlation between the banks traditional game of gouging their business customers, and a planned fee structure for customers accessing their own cash.
Faria de Oliveira continued, "bank profitability is negative. It is negative and the results of European banks were heavy losses in 2011, 2012 and more in 2013, and we estimate that 2014 will be a year with overall negative results but perhaps less bad than in previous years."
On bank charges for electronic payments in the retail sector, Faria de Oliveira commented, "Competition exists, this fact is not at issue, therefore, we can not understand the reason for restrictions on a normal activity in a market economy," he said.
According to Faria de Oliveira “all measures that are applied must be analysed for their impact," so "this regulation to cap (electronic transaction) fees is manifestly disadvantageous to all the countries of the periphery, particularly in Portugal, in relation to all the countries in the rest of Europe."
Asked about the study by David Evans, a professor at the University of Chicago, which today showed that the impact of this Brussels rule on Portugal may be a loss in annual revenue of close to €140 million for Portugal’s banks, Faria de Oliveira said that banks will have to make up this shortfall with some kind of initiative.
