Banks trim online fees to woo customers

Chinese banks are offering discounts for online banking services to consolidate their market presence, even as their profit margin from lending is shrinking due to the low cost for new loans.

The fee reduction spree has been sparked by domestic shareholding commercial banks. In April, Minsheng Banking Corporation, a medium-sized commercial lender, took the lead to cap charges for inter-bank online money transfer at 2 yuan per transaction, compared with the 5.5 yuan per transaction it charges over the counter.

China Everbright Bank followed suit in May by slashing charges for online transfer from 0.5 percent of the total transaction value to 0.15 percent, while Citi Group has pledged to provide free of charge service for online yuan-denominated transfers within China from May 10.