ATM withdrawals to be free: RBI
Customers will not be charged for ATM withdrawals from April 1, Reserve Bank of India deputy governor V Leeladhar announced in Mumbai on Monday.
Addressing a function to mark the Union Bank of India's 2001st branch under its core banking solution, Leeladhar said that at present many banks are levying a charge on withdrawal of cash from their ATMs by customers of other banks with which they have no tie up.
"These costs are at times ridiculous as even for withdrawal of a paltry sum of Rs 500 from ATM the customer has to shell out as much as Rs 250," he observed.
He said before moving to a system of cash withdrawal from ATM without cost, as was prevalent in the United Kingdom and many other countries, from financial year 2009-10, the RBI has decided to allow only Rs 20 per transaction for such withdrawal from April 1 next.
"The commercial banks are racing against each other to post hundreds of crores of rupees (billions) as profits and therefore they must not be fussy about meagre costs involved in cash withdrawal from their ATM by customers of other banks," he said, adding that even the cost involved in installing an ATM has come down from Rs 30 lakh (Rs 3 million) to Rs 6 lakh (Rs 600,000).