• By The Financial District

BIG JAPAN BANK TO COLLECT FEE FROM CLIENTS SANS ONLINE ACCOUNTS

Sumitomo Mitsui Banking Corp. announced that it would charge processing fees to customers aged 18-74 who open bank accounts in April 2021 or later and do not use online banking services, Mainichi Shimbun reported. 

It said it will collect 1,100 yen (about $10) annually from accounts in which there are no transactions for two years or more and the balance is less than 10,000 yen (approximately $94). The aim is to digitize banking procedures and cut costs amid a difficult business environment caused by low interest rates under the Bank of Japan's negative interest-rate policy. 


The collection of processing fees in cases where there have been no transactions for long periods of time has been adopted by Resona Bank Ltd. and some local banks, but Sumitomo Mitsui is the first of the megabanks to announce plans to implement the policy. Reducing the number of unused accounts will not only slash account management costs, but will also help prevent money laundering and other crimes. 


Moreover, Sumitomo Mitsui will collect annual processing fees of 550 yen starting April 2021 for new account holders who want to use paper bank passbooks. Banks pay an annual stamp tax of 200 yen per account for passbooks, which runs into several billions of yen for major banks. Because of its cost-cutting effects, banks are encouraging customers to switch to online banking.