ATM Withdrawal Limits and Charges: Beginning August 1, 2021, the ATM usage fee will be revised
New Delhi: The cost of withdrawing money from an ATM in India has risen. Customers who use their debit cards to withdraw money from ATMs must calculate how many times they withdraw money or they will be charged extra.
The Reserve Bank of India (RBI) has raised the fee associated with ATM withdrawals. From August 2021 onwards, the new adjustments will take effect. As a result, ATM customers must understand how much extra they must pay.
ATM Withdrawal Charges, ATM Withdrawal Limit:
The RBI has approved a rise in the interchange charge per transaction for financial transactions from Rs 15 to Rs 17.
For non-financial transactions, the RBI has hiked the ATM charge from Rs 5 to Rs 6 at all locations.
According to a report, the aforementioned adjustments in ATM charges will take effect on August 1, 2021.
According to the report, the RBI has also allowed banks to increase the cost paid for cash withdrawals over the approved free ATM transaction limit from Rs 20 to Rs 21 per transaction, effective on January 1, 2022.
Customers are entitled to five free transactions per month from their own bank ATMs (including both financial and non-financial transactions). They are also entitled to three free transactions (including financial and non-financial transactions) from other bank ATMs in metro areas and five free transactions in non-metro areas. Apart from free transactions, client prices are capped at Rs 20 per transaction.
"To compensate the banks for the higher interchange fee and given the general escalation in costs, they are allowed to increase the customer charges to Rs 21 per transaction. This increase shall be effective from January 1, 2022," according to a notification issued on Thursday, India's central bank stated.
In June 2019, the RBI formed a committee under the chairmanship of the Indian Banks' Association's Chief Executive to evaluate the full range of Automated Teller Machine (ATM) charges and fees, with a special focus on the interchange structure for ATM transactions.
The committee's proposals have been thoroughly studied. The last time the interchange fee structure for ATM transactions was changed was in August 2012, whereas the charges that consumers must pay were last amended in August 2014.
As a result, the RBI has decided to increase the charges, citing the rising cost of ATM deployment and expenditures for ATM maintenance borne by banks/white label ATM operators, as well as the need to balance stakeholder expectations and user convenience.