The issue of bank service charges has come to the fore again as major commercial banks are set to raise the fees on a variety of transactions. The banking sector had slashed them amid public criticism over the charges.

Participants in the fee hikes include KB Kookmin, KEB Hana and Shinhan, three of the four biggest first-tier banks in the nation.

KB Kookmin is taking the initiative as it plans to raise most service fees next month. They include fees on cash withdrawals and transfers on automated teller machines, currency exchange and issuance of certificates for deposits.

When customers wire more than 5 million won ($4,230) to accounts in other financial firms, they will have to pay a service charge of 4,000 won, compared with the current 2,500 won. In addition, customers will have to pay fees of between 3,000 won and 5,000 won on overseas remittances via the Internet or mobiles, which are currently free of charge.

KEB Hana and Shinhan have already raised the fees on some transactions.

Their move is understandable in a way, given their desperate struggle to overcome weakening profitability amid prolonged low interest rates. They are downsizing their operations by scaling back their workforces and branches nationwide.

They also face a critical challenge from the coming “big bang” involving the Internet-only banks and fintech, which may greatly replace the present face-to-face business at offline branches.

However, banks should bear in mind that they faced tough criticism for providing substantial dividends to shareholders while being reluctant to cut service fees. In 2011, the financial regulator instructed banks to find ways to benefit customers, such as cutting commission fees.

Eighteen local banks, then, pledged that they would cut major service charges, including discounts of up to 50 percent for using ATMs, as part of their effort to gain public trust and join the regulator’s move to improve consumer rights.

Some had promised to get rid of all unnecessary service fees and a few scrapped the former 600-won fee charged for wiring money outside bank hours.

But they are pushing for a revival of the charges and hikes. This is a proof that the banks had no choice but to follow the Financial Supervisory Service’s guidance at the time. Public sentiment toward the regulator was also quite unfavorable in 2011, as a corruption scandal involving some FSS staff and mutual savings banks were revealed.

Consumers don’t seem to have the ability to stopthe fee hikes, and the FSS has an obligation to look into the issue -- to see whether the hikes are reasonable at the current stage.

Five years ago, the commercial banks’ collective annual earnings from service fees reached an all-time high of more than 3.5 trillion won.