FREE exchange or deposit of euro banknotes and coins by banks may be required by law in the future. The Parliamentary Committee for Finances, Budget and Currency approved a revision to the Act on Banks drafted by deputy for the Slovak National Party (SNS) Jozef Ďuračka on February 3.
The amendment would eliminate all bank charges for handling euro coins and notes, as a response to the current situation which entrepreneurs as well as private persons say is unfavourable, the SITA newswire reported.
Several banks announced in late January that they would reduce the fees charged for handling euro cash, but only the complete elimination of fees was acceptable to Prime Minister Robert Fico.
He had informed the Slovak Banking Association (SBA) of a wide consensus for legislation that could be approved quickly unless the fees were reduced to zero or cancelled completely, SITA wrote.
The SBA considers approval of the amendment to be a bad sign for corporations operating in Slovakia. They say it would open doors for additional parliamentary proposals affecting any field of business which would, regardless of the competitive environment, cancel or restrict appropriate rewards to businesses for the services they provide.
The handling of euro coins is currently generating losses for banks, the SBA told SITA, and it claims that the draft amendments would further increase the costs of manipulating coins, from collection to sorting, and then storage and transportation to the National Bank of Slovakia (NBS), and shift this cost to banks and their clients.
The complete cancellation of bank fees for exchange of euro banknotes and coins may pose some risks, the NBS warned.
The free acceptance of euro paper cash and coins without any limits increases the risk of negative migration of coins between eurozone countries, which might endanger fluidity of cash circulation in Slovakia, NBS spokeswoman Jana Kováčová was quoted by SITA as saying.Scrapping the fees may also have an impact on the use and development of tools for cashless transactions through payment cards, POS terminals and ATMs, she added.
The risk of ‘coin tourism’ in which citizens of other countries may be motivated by the free exchange of euro cash to bring it to Slovakia was mentioned by the State Secretary of the Finance Ministry Peter Kažimír at the parliamentary committee meeting.
The Finance Ministry suggested a limit on fees up to a certain number of items, cancelling fees for a limited period of time or regulation of bank charges only when depositing money in one’s own current account, but their proposal was not supported, SITA reported.
The Slovak parliament will vote on the amendment during its ongoing session.
If passed, the amendment will take effect on the day of its publication in the Collection of Laws.