Banks are likely to start charging customers for transacting more than five times a month at any bank ATM, including their own bank.
Banks have mooted the charge on ATM transactions to pay for the increased security costs at ATMs, put in place by many State Governments, following the grievous attack on a woman inside an ATM kiosk in Bangalore last November.
Currently, there is no cap on the number of transactions that a customer can undertake at his own bank’s ATM.
However, the number of free transactions at other banks ATMs has been capped at five a month.
Banks may also down the shutters of some ATMs at night, especially at locations where footfalls are low.
Interchange fee Banks have requested the RBI to allow them to increase the ATM interchange fees (the fees paid by the card-issuing bank to the acquiring bank) to Rs 18 from Rs 15 a transaction now. Further, they want to pass on the costs arising from the interchange fee and switching fee to customers from the sixth transaction onwards.
Last week, RBI Deputy Governor K.C. Chakrabarty said the regulator will have no objections if the lenders charge a ‘reasonable fee’ for the ATM services.
The demand for the increase in fee is on the grounds that hiring security guards for three shifts would cost about Rs 40,000 a month.
Given that the country has about 1.40 lakh ATMs at present, banks will roughly see an outgo of about Rs 560 crore a month on account of providing security alone.
Strike a balance Mohan Tanksale, Chief Executive at the Indian Banks’ Association (IBA), said the charges were arrived at by striking a balance between incentivising banks to set up ATMs and issue debit cards and to bring in discipline among customers.
“Even now, five free transactions are enough to meet the withdrawal requirements of most account holders. For balance enquiries, SMS is a more convenient option,” Tanksale said.
“Post the (Bangalore) incident, banks are taking adequate measures to ramp up security at their ATMs. However, it will be ensured that ATMs at all important public places like hospitals, railway stations, etc will be open 24 hours,” Tanksale said.
Further, IBA is co-ordinating with banks to encourage customers to seed the Aadhaar numbers with their bank accounts to smoothen the Direct Benefit Transfers.
The association has also approved branding of the ‘Talking ATMs’ for the visually challenged and will soon finalise the design and logo for the same. At present, about 10,000 such ATMs have been set up.