Fresh caps on third-party use of ATMs
12 Oct 2009
Diwali will see fresh restrictions on the amount you can withdraw from the ATMs of 'third party' banks.
From 15 October, a customer can withdraw a maximum of Rs10,000 at a time from ATMs not owned by the bank in which the customer holds the account. bank. Also, one cannot make more than five withdrawals a month from such ATMs.
In August, the Reserve Bank of India had asked banks to impose the restrictions on third-party ATM usage from mid-October. The step followed recommendations by Indian Banks' Association (IBA), the apex body of Indian banks.
IBA had submitted its recommendations to the central bank last July citing financial burden on banks due to a large number of third party users and small-ticket withdrawals, resulting in high interchange expenses for banks.
Going by the IBA guidelines, a savings account holder may get five free third-party transactions a month and could be charged from sixth onwards. However, current account holders may be charged for all third-party usage.
The freedom of using ATMs of other banks for services like cash withdrawals and account enquiries without charge was brought into force by the RBI on 1 April.
While banks moaned in public about the loss of 'transaction fees', many of them - such as the Bank of Baroda - took advantage of the new rule by shutting down some of their own branch ATMs and directing customers to ATMs of other banks.
