All ATM services to be free from April 2009

[Anand S]

NEW DELHI: The levies of Rs 20 for using third-party ATMs to avail of
services other than balance enquiry or cash withdrawals, are proposed
to be eliminated from April next year, the central bank said.

At present, banks charge up to Rs 57 per transaction for using ATMs of
other banks. While Rs 25-30 per cash withdrawal is the norm, a balance
enquiry at an ATM other than your bank's can cost Rs 10-15 every time
you click on the button. On their part, banks pay between Rs 18 and Rs
31 to the other bank whose ATM was accessed by its account holder.

With the prospect of an easy revenue stream vanishing, banks have come
up with various arguments against RBI's proposal. While some suggested
a fixed number of free withdrawals during a quarter or a month -- which
could either be prescribed by Reserve Bank of India or left to
individual banks -- at least two players wanted nominal levies.

On its part, the industry lobby, Indian Banks Association, said that
the availability of free ATM services could lead to an increase in the
number of transactions and lower withdrawal amounts. So, it has
suggested, that there should be only two free monthly transactions. In
the metros, it wants minimum withdrawal limit be hiked to Rs 500
besides capping the number of times you can check your account
balance.

Source: Economic Times