Financial Transaction Duty Has Little Impact On Payment Habits

Budapest, June 5 (MTI) – Hungary’s introduction of a duty on financial transactions had relatively little impact on the way payments were made last year, according to a report by the National Bank of Hungary published on Thursday.

“Despite the increased costs engendered by the introduction of the transaction tax, there was no large-scale, rapid adjustment in the payment habits of economic agents in 2013,” according to the report on the country’s payments system. The lack of a “pronounced adjustment” was true for both retail and corporate clients, the report added.

According to the report, most banks passed on the cost of the duty directly and completely to customers. However, in the case of card payments, the cost was priced in indirectly, in annual card fees. The NBH said the pricing of payments was expected to change further as a result of the introduction of mandatory free cash withdrawals this year and a reduction in interchange fees.

The duty on financial transactions was introduced early in 2013 and raised later in the year.

Source: http://mtva.hu/hu/hungary-matters