Financial transactions are now being widely used for all kinds of services, from paying electricity or telephone bills to withdrawing salaries. However, in exchange for these services some local banks charge a modest amount to cover their operating expenses. Just recently some local banks expressed a desire to increase their fees for all the services they provide. News reports quoting sources familiar with the situation in the local banking sector said a number of local banks believed the charges they receive today in exchange for ATM, POS and other services are not enough to cover their operating expenses.
Many customers have objected to the move. “That is totally unfair to all of us bank users because we don’t have any option but to use their services,” one customer said. “As expats, we use banks for almost all our financial transactions. The problem nowadays is that we are practically hostages to their services. Before we didn’t need it but now it is a must.
An office worker complained that his account, which he uses to received his monthly salary, would automatically deduct KD 2 from his account every month. “I don’t know why but they told me I was using a saving account and that it requires a KD 200 minimum balance to maintain it. My argument was that I applied for salary account first, not a saving account, and yet they continue to deduct money from me every month,” he said.
Bank transaction services are automatically deducted from a customer’s bank account when a customer uses any of their services. Fees range from 100 fils to as much as KD 2 depending on the services a customer uses. A public relations officer at a local bank who asked not to be identified told Kuwait Times that the plan to raise service fees was submitted to the Central Bank of Kuwait a long time ago but was rejected.
Currently the issue is being deliberated at the Kuwait Bank Association so that there can be one voice on the matter,” the public relations affiliate said. “We don’t know whether the plan will be accepted but we’d like to see them implemented, especially on the subject of unifying all the fees.
Local banks are demanding a comprehensive redefinition of banking charges so as to keep them more in line with the expenses required for the quality of services they offer. “Current prices are based on old situations that have since featured many changes,” he continued. “I think there is a need for banking services to be reevaluated so that banks can collect their actual charges.
The plan to get a unified fee for the services they offer is intensely criticized by many bank customers. “I don’t think its proper for some banks to call for unified service charges. It’s a marketing strategy by some local banks to entice more clients so to offer incredibly lower price tag on some of their services to keep up competition. What’s the use of being a private bank when you are being regulated,” he said.
The Kuwait Banks Association dropped ATM charges four years ago from 200 fills to 100 fills. According to the report the local banks have been trying for some time to convince the Central Bank of Kuwait that it is time for this fee to be reconsidered.