The move aims to generate revenue that would help cover the costs of continuous development and digital transformation initiatives undertaken by banks
In response to the growing volume of online financial transfers between local banks, a new banking proposal has emerged to impose fees on these transactions.
The move aims to generate revenue that would help cover the costs of continuous development and digital transformation initiatives undertaken by banks.
According to informed sources, the proposal suggests introducing fees for online transfers between different banks, replacing the current practice of offering such services free of charge. While banks currently charge 5 dinars for transfers conducted through branch offices, the new plan would keep in-branch transfer fees unchanged for transactions within the same bank. However, online transfers between different banks would incur a fee ranging from 1 to 2 dinars per transaction, with each bank setting its rate within this range based on its strategic goals.
Proponents of the proposal argue that the surge in online financial transfers, particularly for commercial payments, has created a significant operational burden for banks. Despite the high volume of these transactions, banks currently do not collect any fees for them. Some bankers have specifically suggested imposing fees on transfers executed through platforms like “Wamd” or similar services, as these channels handle a large portion of commercial payments. The daily transfer limit of 3,000 dinars through such platforms underscores their financial significance.
The sources noted that while personal financial transfers typically involve smaller amounts, the widespread adoption of electronic payment services has encouraged customers to shift to online transactions for all types of payments. This shift has been driven by the convenience, security, and speed of online transfers, with some transactions being completed in seconds and available around the clock.
Although banks have largely agreed on the need to impose fees on interbank online transfers, the proposal to extend these fees to transfers via “Wamd” or similar platforms has not gained sufficient support. Concerns have been raised that such a move could negatively impact small-scale transaction users, who are difficult to distinguish in fast-paced money transfer services.
The sources emphasized that the push for fees is partly motivated by the rising costs of digital transformation in the banking sector. Banks are investing heavily in redesigning internal operations and adopting new financial technologies to keep pace with rapid changes in the industry. Imposing fees on online transfers could provide a supplementary income stream to enhance the efficiency and security of these services, ultimately benefiting customers by strengthening protective measures against breaches.
Despite the banking sector’s consensus on the fairness of introducing fees for online transfers, discussions with regulatory authorities, including the Central Bank of Kuwait, have revealed reservations about revising banking fee structures. The Central Bank’s stance aligns with its broader strategy to promote financial inclusion and support digital transformation across the banking sector, suggesting that any changes to fee regulations will be carefully considered to avoid undermining these goals.
In conclusion, while the proposal reflects the banking sector’s need to offset the costs of digital innovation, its implementation will require balancing revenue generation with the broader objectives of financial inclusion and technological advancement.
