Banks, Estonia, Financial Services

Currently the smallest banknote one can withdraw from an ATM is a 25-kroon note.

From January 1, the minimum sum will be 6.2 times bigger, 156.47 kroons in current denomination. This means also that if a person has less than 156.57 kroons on his bank account, he cannot get it from the ATM. In order to withdraw cash in a bank office, one has to pay a service fee. The situation affects primarily people with children an lower incomes who may encounter cash problems when they shop at markets and stores that have no bank terminals or pay for bus tickets, for example.

Bank of Estonia public relations manager Ingrid Mitt said that a committee consisting of representatives of bank of Estonia and commercial banks considers it right that during the two-week parallel use of the euro and the kroon, ATMs would offer just 10- and 50-euro notes. “With 5-euro notes, there is the danger that ATMs will become very quickly empty of cash,” said Mitt. She added that after the two-week parallel use period, every bank itself decides which banknotes to use.

Banks are careful at the moment with responses to the problem, speaking more about their problems than about the comfort of clients.

SEB bank intends to place 10-, 20- ja 50-euro banknotes in ATMs. “Using 5-euro notes in ATMs is not the tradition in the euro area. For example in Slovakia, which has the most similar standard of living to Estonia, 5-euro notes are not used by banks in ATMs,” said SEB communications manager Silver Vohu.

“Swedbank is looking for technical possibilities to issue also 5 euro notes after the period of parallel use of currencies," communications specialist Kaarel Roosa said. He stressed that the average sum of money Swedbank’s clients withdraw from ATMs is according to the 2010 data 950 kroons or nearly 60 euros. “In other euro area states, ATMs mostly don’t issue 5-euro notes, the reasons being technical and also that with bigger denominations, the banknotes in the ATMs last longer,” said Roosa.

One reason for not using the 5-euro notes is allegedly that the banknote is smaller than 10-euro notes an readjustment of ATMs requires extra money from banks.