Luanda — The emergence of more Automatic Teller Terminals (ATM) and, consequently, the availability of more money in ATMs are among the main benefits of the increase in the interbank commission, from 350 to 700 kwanzas.
The measure, in force since January 1st, covers all banks that issue payment cards and install ATMs across the country, without impacting the "pocket of customers holding multi-cash cards", according to the Interbank Services Company (EMIS).
The interbank commission is a rate agreed between commercial banks on reciprocal services provided to each other, without directly impacting the bank customer's pocket, that is, it refers to the amount that one bank pays to another whenever one of your customers uses another's ATM.
Until December 31, 2023, the interbank fee for withdrawing monetary values from ATMs at different banks was 350 kwanzas, a commission that, this year, increases to 700 Kwanzas, which represents an increase of 100% of the previous value.
In an interview with ANGOP, the executive administrator of EMIS, Joaquim Caniço, clarified that the respective commission "does not apply to the payment card user", highlighting that the measure contributes to the existence of more ATMs with cash available in the country, avoiding constant flooding in ATMs.
Joaquim Caniço said that the measure aims to encourage banks to make more money available in ATMs, adding that banks with a reduced number of operating equipment and little financial availability to load ATMs will pay more, because their customers use other people's machines.
Here is the full interview:
ANGOP - The year 2023 ended a few days ago, with a new measure from EMIS, which decided to increase the interbank commission, from 350 to 700 kwanzas. What assessment do you make of the actions carried out by your company last year?
Joaquim Caniço (JC) - The balance is positive. We are growing as expected and managed to implement some initiatives that will contribute to improving the electronic payment system in Angola.
ANGOP - Specifically, what were the main initiatives that positively impacted the lives of users in 2023?
JC - Without a doubt, the biggest milestone was the launch of the Instant Transfer System, which is serving as the infrastructure for the new payment instrument called 'KWiK' (Instant Kwanza). This new instrument is already in use by around 10 participants in the system and we hope that it will begin its revitalization process very soon. Therefore, we are very convinced that KWiK will contribute to improving the provision of a financial inclusion instrument for Angolans.
ANGOP - Last December, EMIS announced the increase in the interbank commission for withdrawing via ATM, from 350 to 700 kwanzas, a measure that has been in force since January 1, 2024. This is a 100% increase. What is the real objective of this measure?
JC - It is important, firstly, to remember that the interbank commission has always existed and has never impacted users' pockets. This fee is part of a set of incentives for banks to better manage the logistics of loading money into their ATMs. In this process, banks that maintain the largest number of ATMs and make more money available to the population earn more.
In short, it is a commission that does not apply to the payment card user, but contributes to the existence of more ATMs with cash available, a fact that will avoid constant flooding at ATMs. Therefore, one of the main advantages of this measure will be the improvement in the availability of cash at ATMs.
ANGOP - Specifically, how many banks will be covered by this measure?
JC - All banks are covered by the interchange commission, as they all issue payment cards and install ATMs. Theoretically, if each bank installs enough ATMs to serve the number of its customers with payment cards and, cumulatively, maintains the respective ATMs with cash, we reach an equilibrium in which the amount payable between banks is residual or even zero.
ANGOP - To what extent will the increase in the interbank fee on ATM transactions not affect customers? In other words, will there be no possibility for commercial banks to pass on the cost of each transaction to the final consumer or to the user of the ATM card?
JC - The Multicaixa network has existed for more than 20 years with this commission, but users confirm that over the years they have not been charged. Therefore, it is only about a few weeks ago that this issue has been repeatedly posed by the press in these terms, as a result of the sharing of a document that only concerns the participants of the Multicaixa system that was irresponsibly passed on to social networks.
ANGOP - What is the current number of active ATM cards and the number of ATMs in the country?
JC - EMIS registers the existence of about 7.6 million ATM cards and close to 3.5 thousand ATMs (CA or ATM) in Angola.
ANGOP - On average, how many ATMs does each commercial bank have?
JC - The average is around 184 ATMs per bank. In any case, CAs are installed by banks depending on the number of payment cards that each bank has distributed to its customers, that is, the larger ones tend to install more CAs, the numbers of which vary from 20 to 570.
ANGOP - Using this data, what is the current ratio between the number of ATMs and the number of cards or users in the country? In other words, what is the relationship between demand and supply of ATMs in the Angolan banking market?
JC - Around 2.2 thousand users per month, that is, on average, each CA serves close to 73 users per day. Sometimes, ratios do not help to understand concepts in their entirety. Therefore, it is essential to note that the multicaixa network somewhat follows the logic of the bank branch network, whose CAs are installed, as a general rule, in bank branches, which are located in areas with greater accessibility and where there may be better installation conditions.
ANGOP - So far, what is the amount or percentage that a customer pays for each movement they make with the multicaixa card (checking available balance, withdrawing money, transfers, paying for services, collecting receipts/paper, among other movements)?
JC - So far nothing has been paid for, unlike what happens in other geographies where there is a user-pays principle. The card is an important payment instrument so that its users do not feel the need to go to banks to withdraw large amounts of money. This must be the understanding so that our country increases, as soon as possible, the use of electronic payments, thus reducing the pressure on the need to use physical money.
ANGOP - For EMIS, what are the main reasons for the constant flooding/queues at ATMs at the end of each month and, especially, in December?
JC - Among the various reasons with a significant impact, we can mention the geographical distribution of the ATM fleet, which is not in line with large population settlements, generating what we commonly call 'urban macrocephaly', that is, more equipment available in urban hulls to the detriment of peripheral areas. This is a structural situation arising from the options that banks have considered over time to incorporate contextual costs into their operations, in contradiction with large population settlements that generally precede infrastructural conditions.
Another situation that also aggravates ATM flooding is the concentration of salary payments, especially public service payments, in very short periods around the last day of the month. The reasons also include the fact that the population uses cash excessively, due to low financial and digital literacy, as well as the high level of informality in many economic activities.
ANGOP - Regarding the availability of Automatic Payment Terminals (TPA), what are the criteria used for the distribution of these devices? Specifically, who should have a TPA, for example?
JC - TPA are assigned by banks to merchants, which can be large, medium, small and micro, in accordance with the regulations that govern acceptance activity, that is, in this sequence, the levels of demand tend to be lower, exactly to massify them.
ANGOP - How many TPA are available on the Angolan market?
JC - There are about 179 thousand TPAs.
ANGOP - How is the use of these devices controlled to avoid possible fraud?
JC - As the use made by merchants is typified in the rules and contracted by banks, it is up to these institutions to ensure KYC (Know Your Customer) procedures, under the legislation in force, without prejudice to the regulated limits, which help to mitigate the risks of fraud.
ANGOP - Is the use of TPA on any street corner or on the street legal? Does this practice ensure security for customers?
JC - In practice, and given that the POS is a wireless device, it offers great mobility to the merchant who owns it. POS is very useful to allow the merchant to receive payments for purchases and also to carry out cash withdrawals. The latter, in addition to being a fundamental vehicle for depositing the trader's money into their bank, serves to complement the services of withdrawals in CA.
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For this purpose, the customer must pay the merchant a commission of 1%. However, what is unfortunately done by merchants is the use of the first feature, intended for purchases, to carry out irregular withdrawals with illegal charges, which is why it is a police case.
ANGOP - What is the real fee or commission that the user must pay when using a POS in the formal and informal market?
JC - According to Instruction No. 12/2021 of the National Bank of Angola (BNA), the commission on cash withdrawals at POS is 1% of the withdrawal amount, with a minimum of 50 kwanzas, which will be automatically transferred to the merchant's bank account.
ANGOP - In August 2023, EMIS announced the launch of the multi-brand card called 'Multicaixa/Mastercard', which aims to meet the banking needs of citizens in Angola and abroad, with a single card. What is the current state of play of this system?
JC - When EMIS launches products and services, it implies, as a general rule, development on the banks' side. At the moment, the process of certifying the banks is under way. Therefore, the process of issuing Mastercard by commercial banks has not yet begun.
ANGOP - What challenges or prospects does EMIS have for 2024?
JC - We will continue to develop the technological infrastructure that supports the payment system in Angola, with a view to contributing to the massification of electronic payments in the country. Therefore, we believe that the year 2024 will be the period of consolidation of KWiK, as well as the launches of payment with QRC (QR code) in POS and the contactless Multicaixa card (contact less card).
In addition, EMIS has an ongoing free program called 'Digital Citizen', which aims to train or empower people, from the age of 15, in financial and digital literacy, as well as mitigate misinformation about payment systems and instruments that still exist in Angola, including in the journalistic class. Therefore, EMIS extends this initiative to any interested public, at no associated cost. QCB/AC/DOJ
