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Withdrawing money from the ATM can be costly soon

Tuesday - February 18, 2020 4:08 pm , Category : BUSINESS
Charges are levied on withdrawing money from the ATM after a fixed limit
Charges are levied on withdrawing money from the ATM after a fixed limit

Free limit to withdraw money from the ATM can be reduced, interchange charge may increase 

FEB 18 (WTN) - There was a time when in order to withdraw money from the bank, you had to wait in the queue in the bank. Naturally, putting in lines to withdraw money from the bank had wasted your precious time. But in this era of technology, the use of the ATM (Automated Teller Machine) has freed people from the hassle of withdrawing money in the bank. Yes, now you can withdraw money at any time by using the ATM, and you do not even need to go to the bank to withdraw money. Technology changed over time, and bank-conscious consumers started using net banking and mobile banking apps. Statistics show that ATM usage has come down comparatively due to the increasing use of digital transactions. 

As we had told you that due to the increasing use of digital transactions, the usage of ATN had been recorded less. In such a situation, there may be an increase in the charge for withdrawing money from ATMs in the coming days. Now, you may be wondering why the fewer uses of ATMs will increase the charge of withdrawing money from ATMs. So let us tell you about it in detail. Actually, for your information, let us know that after withdrawing money from the ATM, a charge is levied. In such a situation, when digital transactions were less, people used to withdraw money from ATM more often than the limit. And for this reason, the bank and the company maintaining the ATM used to earn money through ATMs. But now that people are reducing ATM usage due to digital transactions, the Indian ATM Operators Association has written a letter to the Reserve Bank of India seeking to increase the interchange fees charged on customers for withdrawing money from ATMs. 

For your information, let us know that the ATM Operators Association says that if the Reserve Bank does not give permission to increase the interchange fees, then it will affect their business. The ATM Operators Association argues that not raising the interchange charge will affect the process of installing new ATM machines. And all this will happen in those circumstances when continuous efforts are being made to increase the penetration of ATM machines in the country. 

In fact, the ATM Operators Association argues that their revenue is being affected due to increased expenses and lower usage of ATMs. At the same time, the process of installing new ATMs is being interrupted due to a lack of revenue. The association says that here the Reserve Bank has increased the standard of compliance with the safety and maintenance of ATMs. In such a situation, the cost of security and maintenance of any ATM has increased more than before, following the instructions of the Reserve Bank. But in the same proportion, there has not been an increase in the revenue of companies providing ATM facility. 

For your information, let us know that currently, the interchange fee has been kept Rs 15 per transaction by the Reserve Bank of India on withdrawing money from ATM. Explain that this charge is charged after 5 free transactions per month per customer. Regarding this charge, the association says that this charge is not sufficient in view of the increasing expenses of daily security and maintenance of ATMs. Meanwhile, the Reserve Bank of India constituted a high-level committee in the context of complaints related to ATM shortage. It was the responsibility of the committee set up by the Reserve Bank to explain how the number of ATMs in the country would be increased, and how to increase the penetration of ATMs in remote areas. This 6-member committee had given a lot of suggestions in this regard, in which the most prominent suggestion was to increase the interchange charge. 

According to the committee, in urban areas where the total population is more than 10 lakh, the interchange fees should be Rs 17 for financial transactions and Rs 7 for non-financial transactions. At the same time, the committee suggested that due to the increase in the number of digital transactions, the use of ATMs has reduced compared to earlier. In this case, the limit of free withdrawal from ATMs should be reduced from 5 to 3. At the same time, the committee has said in its suggestion that in rural areas and semi-urban areas where the population is less than 10 lakh, the interchange charge on the financial transactions should be Rs 15, and the non-financial interchange charge should be Rs 8. Also, here the limit of the free transaction from ATM should be reduced to 6. 

It is true that due to increasing digital transactions, more people are using less ATM than the free limit. Now that people are reducing the usage of ATMs, the interchange charge is also collecting less than before. Also, due to new guidelines issued by the Reserve Bank, more money is being spent on security and maintenance of ATMs than before. Now, the committee constituted by the Reserve Bank has recommended increasing the interchange charge, in the coming days, you will have to pay more money for the interchange charge than before if you withdraw money from the ATM beyond the prescribed limit.