Big bank alert! ATM withdrawal fees will increase starting January 1, see new rates and more details | Personal finance news
New Delhi: Starting next month, ATM withdrawals will pinch the customer’s pockets if they exceed the monthly limit for free transactions.
The Reserve Bank of India in June had allowed banks to increase fees for cash and non-cash ATM transactions beyond the free authorized monthly limit starting next year.
“To compensate banks for the higher interchange fees and in view of the general escalation of costs, they are allowed to increase customer fees to Rs 21 per transaction. This increase will be effective from January 1, 2022”, the RBI said in a statement. circular.
New ATM withdrawal fees as of January 1, 2022
Bank customers will have to pay Rs 21 per transaction, instead of Rs 20, from January 1, 2022, if they exceed the monthly limit for free transactions.
However, customers will continue to be entitled to five free transactions (including financial and non-financial transactions) each month from their own ATMs. They could also make three free transactions from other ATMs in metropolitan centers and five in non-metropolitan centers.
ATMs are deployed by banks to serve their own customers and also provide services to customers of other banks as acquirers where they earn interchange revenue.
Why did the RBI allow the increase in charges?
The RBI said the fees have been allowed to be increased given the increasing cost of ATM deployment and ATM maintenance expenses incurred by banks / white label ATM operators, also given the need to balance the expectations of stakeholder entities and the convenience of customers.
It should be noted here that the central bank had set up a committee in June 2019 under the chairmanship of the CEO of the Indian Banks’ Association to examine all the fees and commissions of automatic teller machines (ATM) with an emphasis especially on the interchange. structure for ATM transactions.
The RBI had said the panel’s suggestions had been given careful consideration.