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ACM is favorable to arrangements for keeping cash affordable and available

Dutch banks and various companies and organizations in the Netherlands (including cash-in-transit company Brink’s, ATM operator Geldmaat, the Dutch Consumers’ Association, and the trade association of the Dutch hospitality industry KHN) have made arrangements about keeping cash in circulation. The Netherlands Authority for Consumers and Markets (ACM) is favorable to this initiative. It will not have any major effects on competition, and it helps realize an important societal objective: keeping cash available for everyone.

More and more payments are made electronically, using debit cards and smartphones, among other methods. As a result thereof, it becomes increasingly less profitable for banks, ATM operators and cash-in-transit (CIT) companies, for example, to operate ATMs or to facilitate cash deposits and CIT services. However, cash payments must continue to be possible. Having that option is important so that society can fall back on it when there are disruptions in the digital payment system. That is why these market participants have made arrangements about keeping cash available and affordable: the Cash Covenant (in the Dutch: convenant contant geld).

What is ACM’s opinion?

Some of the arrangements laid down in the covenant include keeping fees for cash services unchanged until mid-2023, and keeping cash available for consumers. The latter means that virtually all citizens of the Netherlands will have access to an ATM within a 5-kilometer radius. After conducting an investigation, ACM comes to the conclusion that, at first glance, this collaboration will not have any negative effects on competition in terms of price, quality, and innovation. The collaboration is therefore not at odds with competition rules.

ACM and the financial markets

Financial institutions, too, have to compete with each other. Such competition has positive effects on the prices and quality of services, as well as on innovation. ACM conducts oversight over the financial markets in various areas. Our oversight aims to prevent financial institutions from concluding illegal anticompetitive agreements. In addition, ACM assesses whether financial institutions do not charge users too much for using debit or credit cards. In that way, ACM ensures that financial markets, too, work well for people and businesses.