https://pagead2.googlesyndication.com/pagead/js/adsbygoogle.js?client=ca-pub-5653101863891512
Home Business Barclays Kenya’s ATM Fee Reconsidered

Barclays Kenya’s ATM Fee Reconsidered

by Caroline Vutagwa
0 comment

Barclays-logo1

 

Barclays Bank of Kenya will yet again be charging you for withdrawing your money via ATM; this the bank say has been prompted by the  their effort to boost its transaction income, having reported 11.2 percent growth in net profit for the first nine months of the year to Ksh6.2 billion.

The bank has started charging an ATM withdrawal fee of Sh30 on ordinary accounts including student accounts, reinstating the charge that was scrapped four years ago. This means that holders of the affected accounts will pay Sh33 for withdrawals after adding an excise tax of 10 percent.

Barclays had scrapped the fees in a customer acquisition strategy as it sought to expand its market share in the fast-growing retail banking segment.

Barclays says customers of accounts that attract a flat monthly fee of between Sh690 and Sh3,100  as well as customers taking multiple services such as credit and loans will be exempted from paying the ATM fees.

The bank’s Chief Financial Officer Yusuf Omari: “We need to balance the need to charge fees and the interest of customers who have taken a bundle of services from us.”

Barclay bank could profit from this through transaction based income that had gone down since it cancelled the transaction fees. The lender’s net profit growth was helped by the absence of a one-time retrenchment cost of Sh788.2 million the year before.

Barclays last year let go of 170 employees whom it paid the amount as part of its plans to shrink its payroll. Its profit before tax and the exceptional item was unchanged at Ksh. 9 billion, underlining the impact of the one-off expense on its current earnings.

Income from commissions and fees like ATM charges fell 5.1 percent to Ksh.6.4 billion, trailing rivals like Equity and Co-op whose transaction-based income rose by double digits.

The bank’s interest income rose 7.6 percent to Sh17 billion but trailed interest expenses that increased at a faster rate of 29.5 percent to Sh2.2 billion. Its loan book dropped to Sh126.2 billion in September compared to Sh128.4 billion in June and Sh118.3 billion in December.

Operating expenses increased 2.7 percent to Sh12.1 billion, helped by stagnation in payroll costs at Sh6 billion as the retrenchment continued to pay off. Barclays’ share price has dropped 7.5 percent in the past one year to trade at Sh17.1.

You may also like

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

https://pagead2.googlesyndication.com/pagead/js/adsbygoogle.js?client=ca-pub-5653101863891512
%d bloggers like this: