It’s the little things – ACCC authorises fee-free ATM agreement

Published On 23/11/2012 | By Louise Beange | Authorisations

ACCC approval has opened the way for the banks to relieve ATM costs for remote indigenous communities

A welcome good news story!  The ACCC has granted authorisation for an agreement between a large collection of banks to provide fee-free ATM services in remote indigenous communities for the next 5 years.

This is the final step in implementing an arrangement with the Federal Government to address the issues identified by their “ATM Taskforce” (you can see the report from the task force here).  Remote indigenous communities pay disproportionately high amounts of ATM fees (in some cases, $40 per week just on fees), due to a lack of other banking options and a low level of financial literacy.  Allowing fee-free services is a direct way to address these issues and was recommended by the ATM taskforce.

The banks proposed an agreement between them that ATM withdrawals and balance checks (but not other services) would be free at selected ATMs in remote areas for 5 years.

The arrangement requires the banks to share some information to give effect to the agreement. This gives rise to a question as to whether the proposed agreement could affect competition in other regions, or facilitate later anti-competitive conduct. Concerns were also raised that removing fees would discourage expansion of banking services or discourage competition between the banks for customers in those areas, leading to longer term issues around lack of services and higher prices.

However, the ACCC ultimately found that these risks were low when existing competition patterns and logistical issues were taken into account, and that the significant benefit to the public outweighed the potential detriment. You can find all the documents, including submissions and the ACCC final report here.

Photo credit: redspotted / Foter / CC BY

About The Author

is a solicitor in the DR team at KWM. In addition to her commercial practice, Louise volunteers with the Downing Centre Duty Solicitor program and ASK!

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