Real competition tries to break Finnish ATM monopoly but then Regulator gets upset!

There are basically 3 big banks controlling some 80% of the banking market with paper thin price differences. Competition is a dirty word in banking here like in many other places.

The banking lobby enjoys huge support from many MP’s in Parliament. The Centre Party is married to the Cooperative Banking Group (OP-Group) and the Conservatives are cohabiting with the Nordea Bank.

Plenty of top civil servants have links to the banks and vice versa – even the head of the independent Financial Authority Regulator worked at Nordea many years ago.

Now the biggest retail group, S-Group, (some 40% market share and also a cooperative group with close links to the Centre Party), has decided to close down the ATM’s owned by some of the Finnish banks, and install new ones from a Norwegian company.

Everybody thought this was a good example of markets working, because the banks here were running a nice little ATM monopoly.

But this party was doused with a bucket of cold water when the Financial Regulator issued a statement that the installation may be in breach of EU’s regulations, and they have written a long letter on their website that even the banking experts at this newspaper cannot understand!

Their 4-page letter (unfortunately in Finnish) refers to an EU Directive about cross-national costs for ATM’s and to a ruling issued by the Finnish Financial Regulator that says something without any meaning except that it appears that offering a new network of ATM’s that have a different pricing from the current incumbent ATM’s is not allowed!

This is such an incredible ruling because there is no information at all about the difference in pricing, nor is there any information about why such a ruling was made in the first place!

Ordinary folk need ATM’s and having competition in the market is essential and it is certainly not the job of a regulator to protect monopoly activities from competition. Such a decision appears to be made because the Finnish banks have lobbied hard for such complex directives that limits new entrants into the ATM monopoly market.

The cost of using an ATM is very low and their convenience so important especially now that banks have closed down many of their offices where ordinary folk request can ask for their cash to be delivered across the counter. ATM’s have also disappeared from the streets.

We all know that banks want to restrict the use of cash and force people to use their payment services, but we have the right and the need to keep and handle cash for  many different reasons – business trips and holidays at home and abroad, cash gifts for birthdays, for shopping and for other small payments. That is our right and our prerogative, and nosey banks and officials do not have any right to interfere in these transactions. Handling cash is the best way to teach younger folk about the importance of managing your own financial affairs responsibly – strictly controlled pocket money and small cash rewards for odd jobs are much better masters than uncontrolled mobile phone bills and cash for clothes, etc. on their terms…

Bank accounts are getting more expensive by the year and we, the customers, are doing all the work to manage these accounts with very little altruistic assistance from the banks.



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