As the Deputy will be aware the Relationship Frameworks with the banks provide that the State will not intervene in the day-to-day operations of the banks or their management decisions. These frameworks are published on the Department of Finance website. I must ensure that the banks are run on a commercial, cost effective and independent basis to ensure the value of the banks as an asset to the State, as per the Memorandum on Economic and Financial Policies agreed with the EU Commission, the ECB and the IMF. However, AIB has informed me of the following: "While AIB’s standard notes lodged fee is one of the most competitive in the market, we are aware that the above changes will impact on c. 5% of our business customers."
Changes to European Regulations in 2011 have meant that AIB is now obliged to check cash lodgements for fitness and authenticity before lodgement to the Central Bank. Historically, AIB was one of the only banks to offer a discount to some of its business customers who prepared lodgements to an agreed standard. This removed the requirement to check the cash in such lodgements and thus allowed for reduced cash handling/notes lodged rates (€0.25 and €0.17) off the standard €0.45c per €100 fee. As a result of the manual nature now involved in checking-counting cash, a review has taken place of AIB’s historical cash handling fees.
In this regard, we have written to all impacted customers offering them the opportunity to approach the Bank to discuss their transaction fee arrangements in advance of the next fee charging period. These discussions and any potential revised fee negotiation and transaction fee arrangements can be put in place up to 30th August next and back dated to the start of that fee quarter. AIB’s business customers often negotiate individual fee arrangements based on their specific circumstances and needs, and the bank is offering them the opportunity to do so in the coming months in order to minimise the impact of the above changes.
More broadly, there may be opportunities for business customers to reduce their overall cash handling and fees through some electronic banking services such as:
- AIB’s Point of Sale systems
- AIB has also launched its ‘contactless payment’ service for transactions up to €15 which involves customers holding their card up to a secure reader which records the transaction in seconds
- For business customers with larger cash lodgement requirements, the use of AIB’s centralised Lodgement Processing may reduce costs
- In-store ATMs offer the ability to recycle cash and which may reduce cash lodgement costs.
In the case of Bank of Ireland I have been informed that with effect from 8 April 2013, the Bank has changed how it accepts coin lodgements from its business customers. The changes include:
- Only full sachets/sacks of coin will be accepted for lodgement or withdrawal
- In addition, coin will not be accepted in priority lodgement bags or nightsafe wallets
- Cash in transit services must be used for bulk coin lodgement.
Bank of Ireland has indicated that it will continue to offer its business customers the opportunity for more efficient day-to-day banking. The Bank has indicated it remains committed to communities nationwide and this change will ultimately deliver an enhanced customer experience and provide greater access to branch staff and their expertise for more complex transactions. The bank has indicated it will be working closely with its customers to ensure an easy transition. With regard to developing a guide to banking costs including cost comparisons between the pillar banks it would not be appropriate for my department to undertake this activity.