The Reserve Bank of India had constituted a Committee in June 2019 under the Chairmanship of the Chief Executive, Indian Banks’ Association to review the entire gamut of Automated Teller Machine (ATM) charges and fees with particular focus on interchange structure for ATM transactions.
The recommendations of the Committee have been comprehensively examined. It is also observed that the last change in interchange fee structure for ATM transactions was in August 2012, while the charges payable by customers were last revised in August 2014. A substantial time has thus elapsed since these fees were last changed. Accordingly, given the increasing cost of ATM deployment and expenses towards ATM maintenance incurred by banks / white label ATM operators, as also considering the need to balance expectations of stakeholder entities and customer convenience, it has been decided as under:
- Transactions free of cost:
- 5 free transactions (inclusive of financial and non-financial transactions) every month from own bank ATMs; and
- 3 transactions in metro centres and 5 transactions in non-metro centres (inclusive of financial and non-financial transactions) from other bank ATMs
- Transactions with charges:
- Fee per transaction is levied as Rs. 15 for financial transactions and Rs. 5 for non-financial transactions beyond free limit of transactions, as mentioned above, in all centres.
RBI allows increase in interchange fee per transaction in all centres:
- From Rs. 15 to Rs. 17 for financial transactions; and
- From Rs. 5 to Rs. 6 for non-financial transactions
NOTE:
- This shall be effective from August 1, 2021.
- Applicable taxes, if any, shall be additionally payable.
- The ceiling/cap on customer charges is Rs. 20 per transaction.
To compensate the banks for the higher interchange fee and given the general escalation in costs, they are allowed to increase the customer charges to Rs. 21 per transaction. This increase shall be effective from January 1, 2022.
These instructions shall also apply, mutatis mutandis, to transactions done at Cash Recycler Machines (other than for cash deposit transactions).
This directive is issued under Section 10(2) read with Section 18 of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007).
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