Withdraw cash from any ATM for Rs 20

From March 31, customers will have to pay a maximum of Rs 20 for withdrawing cash from an ATM of another bank. However, balance inquiries will attract no charge with immediate effect. The Rs 20 fee for cash withdrawal is valid only until March 31 next year after which the transaction will be free.
   Aiming to make all ATM usage free from April 2009, the Reserve Bank of India (RBI) on Monday said banks could not charge for balance inquiries and capped the fee for cash withdrawals at Rs 20 per transaction, irrespective of the amount and the bank where the customer holds the account.
   In a circular issued to all commercial banks,the RBI also said banks could not charge their own customers for ATM usage with immediate effect.
   This is the first instance of the RBI fixing tariffs for the use of ATMs. So far, banks have fixed such charges on their own. As charges vary from bank to bank, a customer can’t be sure of the amount he will have to pay for using the ATM of a bank other than the one in which he holds an account.
   Following the circular, a bank will not be able to charge more than Rs 20 for transactions carried out using the ATM card of another bank. At present, banks charge about Rs 25 per transaction from customers who fail to maintain the required minimum balance in their account.
   Banks took to installing ATMs to cut down on the cost of servicing customers. A bank spends over Rs 50 on a customer it services at its branch, Rs 10 per transaction at an ATM and Rs 2 when it is done online. But despite the cost-effectiveness of ATMs, banks continue to levy charges for ATM use. 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: