Revolut and Wise Consider Exiting Hungary Due to Government Decision
Hungarian Government Pushes for ATMs in Villages to Secure Citizens’ Right to Cash
The Hungarian government has announced a new initiative to ensure that every Hungarian village has an ATM. This move aims to increase the population retention capacity of rural areas in Hungary and secure citizens’ constitutional right to use cash.
Recent reports suggest that the banking sector in Hungary has faced challenges in the past weeks. Banks in the country will need to set up 2,000 ATMs in rural settlements to meet the constitutional requirement for citizens to access cash. In addition, banks must freeze account fees or reduce them to last year’s levels, resulting in potentially billions of forints in profit loss.
The Hungarian Banking Association is calling for fintech companies to share the costs of the ATM campaign. While some neobanks like Revolut and Wise operate in Hungary under EU licenses, participation in such initiatives may not be mandatory for them. These digital-first companies typically do not include ATM setup in their regular business operations. However, they have complied with similar requirements in other EU member states when necessary.
Fintech companies play a crucial role in boosting digital competitiveness in the Hungarian banking sector, particularly through innovations like mobile banking apps. However, there is a concern that imposing additional obligations on these companies, such as establishing ATMs in rural areas, could lead to them exiting the Hungarian market.
It remains to be seen how Wise and Revolut, two prominent fintech companies in Hungary, will respond to these new requirements. If government demands become too burdensome and threaten their competitiveness, these companies may decide to pull out of the Hungarian market altogether.
As discussions continue between the government, national banks, and fintech companies, the future of cash access and digital innovation in Hungary hangs in the balance. Stay tuned for further updates on this evolving situation.
