No charges on withdrawal up to `5K
3 free transactions per month at bank-owned ATMs to continue
A committee set up by the Reserve Bank of India to review the functioning of ATMs to make their services cost-effective for their operators, has recommended that only cash withdrawals of up to `5,000 be considered free transactions.
“Banks may levy charges on the consumer for every individual transaction above `5,000. The banks may decide on the number of free transactions for use of own bank ATMs,” a report submitted to the RBI by the committee said.
The committee was set up in the second week of June last year to review ‘ATM interchange fee structure’ with to give a fillip to ATM deployment in unbanked areas.
In the report, the committee has also recommended an increase in the upper cap for charging customers for financial transactions, over and above the free transactions, from the existing `20 per transaction to `24 per transaction (plus applicable taxes). It said the current three free transactions per month at bank-owned ATMs may be continued in metros and satellite cities and towns with a population of 10 lakh or more, instead of the current six metros of Mumbai, Delhi, Kolkata, Chennai, Bengaluru, and Hyderabad.
“I do not know why they are charging for withdrawals of over `5,000. Even the minimum wage earner could withdraw that amount. The fact that the customer is being left out of the decision-making process is certainly surprising,” Srikanth L. of Cashless Consumer, a consumers collective, who sourced the report through a Right to Information (RTI) application, told Deccan Chronicle.
When contacted, officials of the RBI’s Hyderabad office confirmed that the committee has been set up but any recommendation will become official only if the RBI takes a decision on them. In such an event, RBI will make a public announcement on the issue, the officials said.
News of the recommended fees on withdrawals has been making the rounds on social media with many people in the city saying they received messages from their contacts saying: “Limit Cash Withdrawals to ` 5,000 per transaction committee appointed by the Reserve Bank of India (RBI), headed by chief executive of Indian Banks’ Association (IBA) and consisting of representatives from all stake-holders, except bank customers.”
It is not just the consumers and bankers who were surprised by the news making the rounds. “We have not gotten any written word about this rule. We will only get some clarity when the RBI gives us the guidelines,” said Ch Venkatachalam, general secretary, All India Bank Employees’ Association (AIBEA).