Insider Business Higher bank charges in move to promote e-banking

Higher bank charges in move to promote e-banking

New fees were announced by the Bank of Cyprus, effective as of August 1: fees have been increased for cheque transactions and services provided in bank branches. In contrast, online transactions are charged less or not at all.

This is a policy also adopted by other banks. Hellenic Bank’s fees, announced last March, showed some increase as well. These increases seem to be in line with both banks’ stated intentions to move into the new era of digital banking and reduce personnel costs. Both businesses and individuals are being encouraged to turn to online banking, avoiding transactions through branches and reducing their use of cheques.

An example of charges applied where there used to be none are fees for cash withdrawals from a bank teller. Cash withdrawals are now charged with 1 ‰ (per thousand) at the Bank of Cyprus, with a minimum of €0.05 and a maximum of €2. This charge applies to both physical and legal entities with current accounts.

Hellenic Bank’s charges for current/ trading accounts, as stated on its website, are: €0.15 for each account entry, €0.30 when the accounting entry concerns cash withdrawals from a teller  with a minimum of €2.00 and a maximum of €7.00 for Natural Persons and a minimum of €5.00 and a maximum of €30.00 for Legal Entities. The charges will be made on a monthly basis.

Bank of Cyprus has also introduced a fee of €0.15 for transfers between accounts by the teller, for transfers to a third party’s general account and for deposits against a third account. There is also a minimum charge of €150 for opening a specific client account and for Provident Funds. Hellenic Bank does not charge for transfers within the bank between accounts belonging to the same customer. For transfers between accounts of different customers in euro or in the same foreign currency within the bank, no fees are charged for up to €5,000,00, while there is a charge of €5,00 for transfers over this limit.

Bank of Cyprus has also increased the fee for issuing a chequebook from €15 to €25 if the booklet is ordered from the branch network and from €6 to €16 when ordered online. Also, for the first time, a fee of €2 is required for cashing a cheque by the Bank of Cyprus, as, until now there was only a fee of 0.2% with a minimum of €5 if the cheques were issued by other local banks. Hellenic’s charges for issuing a chequebook with 50 cheques is €20 and  10 for a chequebook of 15 cheques. No fees for cashing a cheque were announced.

The Bank of Cyprus has also imposed  higher fees for use of safe deposit boxes. The new charges imposed on legal entities include increases in contract preparation costs for loans increasing to €150 from €100 for small and medium-sized businesses to €350 from €200 for large companies, while there is a fixed charge of €750 for large companies in mortgage registration. For both legal and natural persons the cost of mortgage elimination for early repayment of a loan is increased to €150 from €50 for legal entities and €75 from €50 for natural persons.

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