You might soon enjoy the convenience of being able withdraw cash from any ATM without paying Saswitch fees, if an industry proposal made to the Competition Commission by First National Bank (FNB) recently is anything to go by.
You pay Saswitch fees when you use the ATM of a bank other than your own. The banking industry - which is dominated by Absa, FNB, Nedbank and Standard Bank - takes in about R500 million in Saswitch fees annually.
The difference between the fee you pay for a withdrawal at your own bank's ATM and the fee for making a withdrawal from a rival bank's Saswitch ATM reflects the money that is paid to the bank that owns the ATM for providing the service.
Sizwe Nxasana, the chief executive of First Rand Bank, which owns FNB, says the country's extensive ATM network could be used more efficiently if Saswitch fees, which are paid by customers to use another bank's ATM, were eliminated.
FNB accountholders, for example, pay between R10.75 and R20.75 for a withdrawal from another bank's ATM compared with paying up to R6 for a withdrawal from an FNB ATM.
Nedbank customers pay R2.85 plus 90 cents per R100 for a withdrawal at a Nedbank ATM and this fee plus R5.95 for a withdrawal from a rival bank's ATM.
However, if you bank with Standard Bank, you pay from zero to R4.90 or R3 plus 0.9 percent of the amount you withdraw from a Standard Bank ATM, compared with R6.70 at another bank's ATM.
Absa customers pay between R2.70 and R3 for a withdrawal from an Absa ATM, compared with between R9 and R12 from another bank's ATM.
Absa supports FNB's suggestion to drop Saswitch fees as the proposal provides an opportunity to increase access to banking for the "unbanked."
Absa group executive director Louis von Zuener says the proposal is good news for consumers since Absa has the largest network of ATMs, with 6 776 nationally, including sites at hospitals, petrol stations, shops, universities and technikons.
Von Zuener says in 2007, the bank will spend R168 million on the roll-out of a further 375 ATMs, 100 internet kiosks, 175 self-service kiosks and 30 "cash acceptors", which will reduce the cost of cash deposits for its customers.
Nedbank has also voiced its support and plans to spend R1 billion on expanding its distribution network, including ATMs over the next three years.
Saks Ntombela, a spokesman for Nedbank, says alternatives to the current Saswitch interchange and consumer fee structures would improve access to bank services for consumers.
However, Standard Bank has made clear its disapproval of the proposal and believes it will be prejudiced if Saswitch fees are dropped since it has a smaller ATM network than either FNB or Absa.
The bank believes the move will simply enhance the ATM network structure of bigger banks such as FNB and Absa.
Sim Tshabalala, the chief executive of personal and business banking at Standard Bank, says FNB's proposal will have "competitive consequences" for his bank.
Saswitch fees are a competition issue and should not be confused with the carriage charges banks impose for transactions made over their computer networks, Tshabalala says.
Absa will make a presentation its recommendations regarding the banking industry to the Competition Commission at the end of the month.
The deadline for supplementary submissions to the Competition Commission after the public hearings have concluded, is February 2.
A final round of public hearings will take place in March and April to air any issues that still need to be dealt with. These hearings will include expert opinions on the submissions received.
A final written report will be released by the Competition Commission between May and June next year.