New Delhi: The Reserve Bank of India (RBI) has reduced the number of free transactions at automated teller machines (ATMs) of banks other than a customer’s own bank to three a month from the earlier five. Any additional usage will attract a maximum levy of Rs 20.
At present, the rules are applicable only in six metro cities of Mumbai, New Delhi, Chennai, Kolkata, Bangalore and Hyderabad. The RBI also allowed banks to levy ATM charges beyond five transactions for the same bank’s account holders. On the other hand, banks are free to offer free transactions over and above the central bank’s limit.
The rules are, however, not applicable to customers having basic or small savings bank accounts.
RBI said banks are free to offer free transactions above this mandated limit but not many banks are likely to offer freebies as cost of maintaining small accounts has risen over the years.
The objective of this direction, RBI said, is to “move away from micro management of business decision of banks while protecting the interests of the weaker sections of the society”.
RBI said the number of ATMs across the country rose to over 1.6 lakh at the end of March from a little over 27,000 at March end, 2007. The point-of-sale (POS) infrastructure has increased from 3.2 lakh to 10.65 lakh terminals during this period. Banks are gradually leveraging their ATMs to deliver other financial and non-financial products to their customers.
SBI and five associate banks together have the largest ATM network of 53,107 ATMs. Union Bank of India is planning to install 458 ATMs as against 200 branches during the financial year. For every 100 branches, the bank has 167 ATMs.