Fees bank can charge clients reduced

Fees bank can charge clients reduced

Fees bank can charge clients reduced

The range and the levels of fees and commissions that local banks can charge retail and commercial clients have been lowered, the Turkish Central Bank and the country’s banking watchdog regulator (BDDK) have announced.

The measures will cut the various charges banks can charge financial consumers to 16 from 20, the BDDK said.

Separately, the Central Bank announced that the number of fees that banks can charge their commercial clients for products and services had been reduced to 51 items under a regulation to render fees more transparent.

These fees are offered under four categories in the forms of commercial loans, foreign trade, cash management and payment systems, the bank said. Previously the number of fees had been 2,400.

Under the existing arrangements, the amounts charged by banks “are far from being comparable and might lead to overcharging. Consequently, client complaints have increased significantly,” the bank said.

Treasury and Finance Minister Berat Albayrak welcomed the move.

“There had been complaints from citizens and businesspeople regarding those charges. The Central Bank and the BDDK have now standardized fees and commissions,” Albayrak wrote on Twitter.

“With every step we take, we will continue to prioritize protecting our citizens’ interests and lowering their costs,” he added.

The minister said they would also reduce the upper limits on electronic fund transfers (EFT) to between 1 ($0.17) and 100 Turkish Liras from 6 to 850 liras.

The BDDK regulations, published in the country’s Official Gazette, abolished fees charged to commercial customers for opening and operating accounts.

The fees charged for EFT transactions were reduced, with an upper limit of 1 lira for mobile banking transactions below 1,000 liras, compared to a previous limit of 6 liras.

The maximum charge for such transactions at automated teller machines was set at 2 liras, down from 17 liras and was set at 5 liras for other EFT transactions, compared to a previous 67 liras.

Non-interest income of local banks increased by 37 percent from 2018 to stand at 106.2 billion (around $16 billion) last year, state-run Anadolu Agency reported, citing data from the BDDK.

Income from fees and commissions amounted to 65.5 billion at the end of 2019, marking a 35 percent rise from the previous year.

Lenders collected some 49.6 billion liras in revenue from banking activities.

The net profit of Turkey’s banking sector totaled 49.8 billion liras ($8.4 billion) in 2019, declining from 53.52 billion liras in 2018.

Deposits held at lenders totaled 2.6 trillion liras, jumping 26 percent from the previous year.

Total assets of the sector surged 16.2 percent year-on-year to 4.49 trillion liras as of end-2019, while loans amounted to 2.66 trillion liras, a rise of 11 percent on an annual basis.