By Ranjit Singh
IN this age of technological advancements, the RM1 inter-bank Automated Teller Machine (ATM) withdrawal charge is seen as excessive as online transfers can be carried out at zero cost. It is said that the fee is to allay costs involved in the provision of ATM services such as the maintenance of the machines and the transportation of hard cash.
However, charging RM1 for each inter-bank ATM withdrawal at local banks and RM4 at foreign banks has resulted in Payment Network Malaysia Sdn Bhd (PayNet), formerly known as Malaysian Electronic Clearing Corporation Sdn Bhd (MyClear), making huge profits. Paynet owns 100% of the MEPS network under which banking transactions can be made via ATMs of all banks in the network.
There are calls for the RM1 to be abolished or at least reviewed to lessen the burden on consumers.
More importantly, is it right for the central bank, which holds a 37% stake in PayNet, to be involved in a business entity? How can one expect the central bank to carry out its supervisory and regulatory role in the best interest of the country when it will also want to make more profits?
The other shareholders of PayNet are a consortium of 11 local banks which hold a 5.73% stake each or a combined 63%. The 11 banks are Malayan Banking Bhd, CIMB Group Holdings Bhd, RHB Bhd, Public Bank Bhd, AmBank Bhd, Bank Islam Malaysia Bhd, Affin Bank Bhd, Hong Leong Bank Bhd, Alliance Bank Malaysia Bhd, Bank Muamalat Malaysia Bhd and Bank Rakyat.
The government should relook BNM’s role as a shareholder in PayNet. It does not augur well for the central bank as the leading monetary authority in the country to be partaking in a business as this would cloud its role as a steward of the nation’s coffers.
The Ministry of Finance (MoF) should immediately review the operations of PayNet as it has been clearly benefiting at the expense of the people. The RM1 charge seems miniscule but based on transaction volume, it adds up to a large amount.
According to a filing with the Companies Commission of Malaysia (CCM), PayNet recorded a net profit of RM170.1 mil for the year ended Dec 31, 2018 compared with RM62.6 mil in the previous year. It has been consistently enjoying margins in excess of 30% since 2014 (based on data available on CCM).
PayNet’s higher profit comes on the back of a 77.5% revenue growth to RM348.8 mil in FY18 from RM196 mil in the previous year.
Another issue that merits attention is the appointment of Peter Schiesser as PayNet’s group CEO on Aug 1, 2017. Is there a need for a foreigner to continue helming PayNet? We can only deduce that he does not come cheap. Why can’t we appoint a local to hold the top post in the company?
Surely, having fresh blood and local successor would be good for the company. Many Malaysians would be more than qualified for the top job. – Jan 30, 2020
