Using ATMs might become more expensive. The Confederation of ATM Industry (CATMI) has asked the Reserve Bank of India (RBI) and the National Payments Corporation of India (NPCI) to raise the fee customers pay for cash withdrawals.
CATMI wants to increase the fee to a maximum of Rs 23 per transaction to secure more funding for the business. The interchange fee is the amount the cardholder’s bank pays to the bank that owns the ATM used for the withdrawal.
5 ATM Transactions Are Free
Currently, banks allow their savings account holders at least five free transactions per month in six major cities: Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, and New Delhi. For ATMs of other banks, three transactions are free.
Stanley Johnson, executive director of AGS Transact Technologies, an ATM manufacturer, According to a report in ET the interchange rate was raised two years ago. He said they have been in touch with the RBI, which seems open to further changes. CATMI has asked to increase the fee to Rs 21, while some other ATM manufacturers have suggested raising it to Rs 23.
He said, “The last fee increase took several years, but now everyone agrees, and the fee will go up soon.”
The Fee Was Increased In 2021
In 2021, the interchange fee for ATM transactions was increased from Rs 15 to Rs 17. The maximum fee that can be charged to customers also went up from Rs 20 to Rs 21 per transaction.
Another ATM manufacturer said, “There has been strong lobbying to raise the interchange rate. A request was sent through NPCI, and banks have agreed to the increase. The manufacturer added that NPCI sets the interchange fee rate.
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