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ATM withdrawals may no longer be free

Yahoo! India Finance
Yahoo! India Finance
ATM withdrawals may no longer be free

Soon account holders may have to pay to withdraw money from their own bank’s ATMs.

The Indian Banks Association (IBA) has proposed that the mandatory five free transactions that banks are required to allow in a month include even the ones at the ATMs of an account-holder's bank.

This proposal for additional charges comes in the wake of higher expenditure foreseen by banks given the new directive that every ATM kiosk should have guards as well as electronic surveillance in the form of CCTVs.

The instructions have come from state governments in the wake of a brutal attack at an unguarded ATM kiosk in Bangalore last year.







The Reserve Bank of India said it will have no objections to banks charging customers for transactions on automated teller machines, provided they charge a "reasonable" fee

"If banks charge a reasonable fee on ATM (automated teller machines) transactions then the RBI will have no objections," Chakrabarty told reporters on Thursday at an event.

"If banks are going into losses they will have no choice but to raise charges," Chakrabarty said.







As of now, no request has come from lenders to raise fees for ATM-related transactions, he said.

Also, the issue of charging customers for using ATMs ought to be left to competitive market forces and banks should be given the liberty to decide their own offerings, he added.

Currently, free transactions at cash outlets of other lenders are fixed at five per month. A customer can use his or her bank's ATM as many times in a month.