a RECEIVE
EIGHTEENTH CONGRESS ) oare, OCT 2 4 2019
OF THE REPUBLIC OF THE PHILIPPINES _ ) trae
First Regular Session ) !

HOUSE OF REPRESENTATIVES

House Bill No. 5238

Introduced by Representative VICTOR A. YAP

EXPLANATORY NOTE

Automatic Teller Machines (ATMs) are electronic banking outlets which allow customers to
complete basic banking transactions without the need of a bank representative or teller.ATMs allow
consumers to perform quick, self-serve transactions from everyday banking like deposits and
withdrawals to more complex transactions like bills payments and transfers.'Moreover, an ATM’s
basic purpose is to provide every individual convenient access to their hard-earned money through
the easy availability of cash dispensers in suitable locations nationwide.

However, this modern convenience comes with a price. As a service provided by private
financial institutions, fees are imposed for most banking transactions such as dispensing of cash
through ATMs.The fees range from ten pesos (P10) to fifteen pesos (P15) depending on the
discretion of these financial institutions.

‘The BangkoSentral ng Pilipinas (BSP), which is constitutionally mandated to provide policy
direction in the areas of money, banking, and creditissued Circular No. 980, Series of 2017 that
regulates the pricing principles of BangkoSentral Supervised Financial Institutions (BSFls),
particularly the fees imposed upon electronic payment transactions. The circular mandates BSFls to
disclose to the BSP the details of all fees that will becharged to the client as well as the publishing
of these fees in an electronic board bulletin. However, such information is not necessarily disclosed
to regular clients, especially as regards the transactions with ATMs.

This bill seeks to protect all persons availing ATM services against undisclosed fees upon
their transactions, require transparency from BSFls to disclose all charges to be imposed upon
clients before the transaction is fulfilled, and regulate the charges imposed for ATM transactions in
order to promote the equitable interest of the ATM users and the financial service providers.

In view of the foregoing, the immediate passage of this bill is earnestly sought.

Representatiye, 2nd District of Tarlac

' Retrieved from https://www.investopedia.com/terms/a/atm.asp on 16 October 2019.

?Retrieved from http://www.bsp.gov.ph/downloads/regulations/attachments/2017/c980.pdf on 15 October 2019.


EIGHTEENTH CONGRESS )
OF THE REPUBLIC OF THE PHILIPPINES — )
First Regular Session )
HOUSE OF REPRESENTATIVES
5238

House Bill No.

Introduced by Representative VICTOR A. YAP

AN ACT
REQUIRING FINANCIAL INSTITUTIONS TO POST TRANSACTION FEES FOR EACH
AUTOMATED TELLER MACHINE TRANSACTION AND RESTRICTING
TRANSACTION FEES FOR AUTOMATED TELLER MACHINES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SECTION 1. Short Title. - This Act shall be known as the "Automated Teller Machine
(ATM) Fee Regulatory Act".

SEC. 2. Declaration of Policy. - Pursuant to the policy of the State to promote the
general welfare of the people, this Act seeks to uphold one's right to be informed of ATM fees
before being charged with the same.

SEC. 3. Definition of Terms. - The following terms as used in this Act shall be defined
as follows:

(a)The term "Automated Teller Machine" or "ATM" refers to any machine that
dispenses cash or performs other banking services when an account holder inserts a
bank card; and

(b)The term "Financial Institution" refers to a universal bank, commereial bank, thrift
bank, rural bank, cooperative bank, Islamic bank, or any entity that owns or
operates an ATM.

SEC. 4, Fees Disclosure. - Financial Institutions shall disclose the total transaction fee
or surcharge to be imposed for each transaction on the screen of the ATM prior to the completion of
the transaction. The customer shall have the right to cancel the transaction after the fee or surcharge
is disclosed.

Financial Institutions shall provide a written notice to its account holders that a fee may
be imposed when the account holder uses ATMs owned or operated by another Financial Institution
or any national, regional, or local ATM network whenever a card, code, or other means of ATM

access is issued by the Financial Institution for the purpose of initiating ATM transactions.


SEC. 5. Fees Restrictions. - The following fees restrictions shall apply to all ATMs and
ATM transactions under this Act:

(a) Screen Display and Printed Receipt Requirement - No customer shall be charged any
fee or surcharge by a financial institution for an ATM transaction unless the fee or
surcharge is displayed on the ATM screen prior to the transaction and the fee or
surcharge is indicated on the printed receipt.

(b)Telephone or Mobile Phone Transactions - No customer shall be charged any fee or
surcharge for any ATM transaction initiated via telephone or mobile phone.

(c)Single Fee per Transaction - No customer shall be billed for more than one fee per
ATM transaction regardless of the number of Financial Institutions involved in the
transaction.

(d)Cash-Dispensing Requirement - No customer shall be charged any fee or surcharge
for a transaction that did not dispense any cash.

(e)Cap on Transaction Fees - No ATM transaction fee shall exceed 1% of the total

transaction amount,

SEC. 6. Implementing Rules and Regulations. - Within sixty (60) days from the
effectivity of this Act, the Department of Finance and the BangkoSentral ng Pilipinas shall

promulgate the necessary rules and regulations to implement this Act.

SEC. 7. Repealing Clause. - All statutory laws, orders, issuances, rules and regulations,
and/or parts thereof which are inconsistent with the provisions of this Act are hereby repealed or
modified accordingly.

SEC. 8. Separability Clause. - If any portion or provision of this Act is declared invalid
or unconstitutional, the portions or provisions which are not affected shall remain valid and

effective.

SEC. 9. Effectivity. - This Act shall take effect after fifteen (15) days following its

publication in the Official Gazette or in two (2) newspapers of general circulation.

Approved,