The Competition Commission of Pakistan (the “Commission”) took notice on its own of ATM cash withdrawal charges implemented by banks in Pakistan. It was observed that banks are charging uniform amount of Rs.15 for ATM cash withdrawal transaction despite having non- uniform business dynamics regarding the aforesaid service.
The Competition Commis-sion of Pakistan (CCP) imposed a Rs50 million fine on 1-Link Guarantee Limited and Rs50 million each on its 11 founding member banks and Rs10 million on each of its 17 non-founding member banks for imposing even customer charges for using ATMs of other banks. Citibank has not been charged as it did not follow this practice. It has imposed Rs50 million penalties on each member bank including National Bank of Pakistan, Allied Bank, Habib Bank, Bank Al-Falah, Askari Bank, Soneri Bank, NIB Bank, United Bank, Standard Chartered Bank Pakistan, Faysal Bank and Bank Al Habib.
The Commission has also imposed Rs10 million fine on each non-founding members, Al Baraka Bank Pakistan, Burj Bank, Meezan Bank, Bank Islami, Khadim Ali Shah Bukhari (KASB) Bank, Habib Metropolitan Bank, The Bank of Khyber, Dubai Islamic Bank Pakistan, JS Bank, Silkbank, The Bank of Punjab, Samba Bank, Sindh Bank, Barclays Bank PLC Pakistan, Tameer Microfinance Bank Limited, Kashf Micro Finance Limited and Summit Bank.
The collusion among the banks was established from the fact that none of the banks placed any Board decision with respect to passing on Rs15 on its customers.
The CCP established that 1-Link required its member banks to incorporate the decision made in its Board meeting regarding increase of ATM cash withdrawal charges from Rs15 to Rs20. Similarly, 1-Link Committee made recommendation that Rs5 may also be charged to customers for balance inquiry transaction by its member banks.