Currently, transactions at an ATM kiosk operated by the bank in which the individual maintains an account entails no cost for any number of transactions. The decision in this respect is not imposed by the RBI rather it is enforced by banks to enhance customer service and reduce workload at bank branches. Nonetheless, free ATM transaction at another bank's ATM is capped at five/month.
Banks have approached the RBI to allow them to raise the ATM interchange fees from the current Rs. 15 to Rs. 18 per transaction. ATM interchange fee is the amount paid to the acquiring bank by the card issuing bank. Further, banks desire to pass on the increased fees (interchange fee plus switching fee) to its customers from the sixth ATM transaction.
The proposal to increase ATM transaction fees is supported by the fact that deploying security forces for three shifts shall entail a cost of Rs. 40,000 per month for banks.
Earlier last week, K.C. Chakrabarty, Deputy Governor of RBI, stated that the regulator will have no objections if the lenders charge "reasonable fee" for such services. To align the cost parameter, banks are also mulling shutdown of some of the ATM kiosks with low footfalls at night. " However, it will be ensured that ATMs at all important public places like hospitals, railway stations, etc will be open 24 hours," Tanksale said.