PRESIDENT OF RUSSIA SIGNED AN ACT ON LEVELLING FEES FOR INTRABANK TRANSFERS

Now fees for transfer within the same bank will the same for intraregional and between-regions transfers

On 16 December 2019, President of the Russian Federation signed a FAS-drafted № 434-FZ Federal Law “On amendments to Article 29 of the Federal Law “On banks and banking” of 16.12.2019.

Under the new law, banking remuneration for money transfers between bank accounts of physical persons within a credit organization cannot be caused by opening the accounts in different separate branches of this organization.

The new measure is designed to eliminate the current interregional discrimination of consumers of banking services. For instance, some banks set an elevated fee for inter-regional transfers of funds compared to intra-regional transfers between accounts of physical persons in the same credit organization.

According to Deputy Head of FAS Andrey Kashevarov, transfers between accounts opened in different territorial units of a bank do not create added value compared to transfers within the same territorial zone and do not incur additional services for consumers.

“Therefore, different fees for such transfers depending on the beneficiary’s location in Russia indicates interregional discrimination of consumers, and the amendments to the law are aimed at eliminating it”, explained Andrey Kashevarov.

The law comes into force180 days after its official publication.

The following positive effects are expected from eliminating interregional discrimination:

Enabling free movement of monetary assets on the financial market of the Russian Federation through weakening geographical barriers;

Developing non-cash transactions by making them more attractive for end-customers;

Eliminating discriminatory tariff-setting practices that infringe consumer interests;

Motivating credit organizations to optimize their business-models and business-processes, particularly, technological solutions to the fullest satisfaction of their customers.

The law is drafted under the frame of executing 2018-2020 National Competition Development Plan and the Road Map for developing competition as well as orders given by the Government of the Russian Federation.