Banks put forward ATM charges proposal
The Indian Banks Association (IBA) is proposing a charge for ATM withdrawals, even from your own bank ATMs.
Banks claim their costs have risen in the recent past, and banks are looking at ways to offset by passing on a portion of that cost to consumers. A recent proposal highlights this issue; following the ATM attack in Bengaluru some state governments have made it compulsory for banks to step up security at their ATMs. According to the Indian Banks Association (IBA), ATM security is an additional cost, estimated to be about Rs4,000 crores annually.
As a result, the IBA is drawing up a proposal which would include a charge to customers for using ATM services. M V Tanksale, CEO of IBA, was quoted in the Economic Times as having said that the IBA is considering a proposal for free transactions even at a customer’s own bank ATMs to be limited to five in a month.
What this could mean
For those who withdraw small amounts frequently, this would add quite a steep charge to the service. MSI feels that such an increase isn’t in the best interest of consumers. And it might not be in the best interest of banks either, as the number of transactions at ATMs may drop (if charges are levied on transactions) and customers could turn to bank branches instead.
As it stands
The RBI hasn’t made any changes yet to the rules governing ATM withdrawals – you are still allowed five free transactions every month from other banks’ ATMs. Anything exceeding this will be charged Rs20 per transaction. There is currently no limit to free transactions at ATMs run by your bank.