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LKI PRESS STATEMENT
September 27, 2020
LABAN KONSYUMER SPEAKS AGAINST GCASH RESUMPTION OF CHARGING FEES BUT SUPPORTS CAP ON CREDIT CARD INTEREST RATE
Consumer Group Laban Konsyumer Inc. (LKI), recently stated and voiced out their concerns over the recent news that selected commercial banks will begin charging a transaction fee when doing fund transfers into GCash using the InstaPay network.
In a statement, GCash said the policy will take effect on October 1, with the consumer group speaking out against this development, highlighting that “most of our country is still undergoing quarantine, lockdown and reeling from the ongoing effects of the pandemic. Many Filipinos still have no jobs and means to pay high amounts, and this additional fee of GCASH will only make life harder for those affected by the pandemic. The positive Covid 19 cases are still rising, our economy is still suffering and many of us are struggling financially. Now is not the best time perhaps to impose or resume the charging of fees, on top of the normal transactions.”
“Effective October 1, 2020, selected commercial banks and Electronic Money Institutions (EMIs) using the InstaPay network will start charging a transaction fee when doing a fund transfer (cash in transaction) into GCash,” read the statement of GCASH.
But consumer group Laban Konsyumer spoke out on this and said “fees like this should be suspended for the rest of the pandemic, as we are still in a state of calamity. This is a response to relief measures that can benefit the general public and deepen the use of digital payments during the pandemic. Hopefully these companies can extend the waiver of fees, because right now we have to push for the use of digital payments now as part of a safe and convenient payment system. Imposing and resuming these fees will act counterproductive to these initiatives, efforts and purposes. A good goal for our country in fact should be to have half of all financial transactions in volume and value in digital form, and this can be encouraged if there are no additional fees, especially during the pandemic.”
Atty. Vic Dimagiba, President of LKI said “Fees will vary depending on the bank or EMI but could be up to P50 each, GCash said, so this is a significant amount. A range of 15 to 50 pesos, depending on the banks, for every transaction will definitely add up and pile on the expenses of an average consumer. There was an advisory. To avoid paying a transaction fee, GCash users are advised to link their BPI or UnionBank accounts to their GCash App. These fund transfers will remain free of charge. But GCash will charge a P15.00 fee per fund transfer (cash out transaction) to a bank or EMI using the InstaPay network. This will also take effect on October 1.”
Dimagiba explaiend and raised alarm to that “ the imposition of fees may run counter to some provisions of REP ACT 11494. This is added expenses for e-commerce. There is no reasonable logic behind the decision to impose fees. The bulk of those using GCASH are individuals doing daily online purchases.”
LKI also on the other hand welcomed the Bangko Sentral ng Pilipinas’ (BSP) move to set a cap on the annual interest rate of all credit card transactions as the latest policy is seen to ease the burden on both households and businesses amid the COVID-19 crisis. On Thursday, the BSP’s policy-setting Monetary Board set the limit on the annual interest rate on all credit card transactions at 24% effective November 3, 2020.
LKI said it recognizes the importance of the credit card policy reform during this critically difficult period. We support this initiative by the Bangko Sentral ng Pilipinas. This will help ease the burden of every household including businesses severely affected by the pandemic. The consumer group appreciates the continuing collaboration between the industry and the regulator as we continue to fight the ill-effects of the COVID-19 health crisis.
Last July 19, 2019, Laban Konsyumer wrote the Bangko Sentral Governor on “Bank Fees Consumers need to stop paying. The details can be downloaded in www.labankonsyumer .com as LKI 41st Press Statement in 2019.