From facing the long peak hour
traffic to pollution galore and a generally stressful life, residents of
metropolitan cities now have another thing to worry about. Residents of six
metropolitan cities would now have to check their monthly ATM transactions as
the Reserve Bank of India has issued new guidelines for ATM usage which
effectively limit the number of free monthly ATM transactions. The good news
however is that the banks including both public and private sector banks are yet
to embrace the new ATM guidelines and are offering free ATM transactions as
before.
While banks are holding off the revised ATM transaction charges for now, it
may not be long where some banks start adopting the new guidelines limiting the
number of free ATM transactions. So, if you are one of those, using bank ATMs
for frequent cash withdrawals, it’s time to change your habit for good to avoid
any unnecessary charges.
Understanding New RBI ATM Transaction Rules:
According to the Reserve Bank of India guidelines, all savings bank account
holders in metropolitan cities would be allowed five transactions from ATMs of
their banks inclusive of cash withdrawals, mini statement and change of personal
identification number or PIN number or balance enquiry. The RBI guidelines
though initially restricted free transactions to three per month when using ATMs
of other banks effect from 1st November 2014, later there was a relaxation to
the policy allowing banks to fix their stipulated free ATM transactions. Since
RBI has indicated that it has laid down guidelines for minimum free ATM
transactions per month for people living in six metropolitan cities including
Mumbai, Delhi, Bengaluru, Chennai, Hyderabad and Kolkata, the final decision on
decided the upper limit in the number of free bank ATM transactions lie with the
respective banks. The number of free transactions from non-home ATMs is also
reduced to three.
Restricting ATM Usage to Increase Bank Footfall and Online
Transactions:
ATMs were introduced in an attempt to ease the footfall and rush in the banks
allowing people an effective and easy way to withdraw and deposit cash. Now with
the free ATM usage restrictions being streamlined, experts feel that it would
mean going to the olden days when banks were crowded and even a small banking
transaction like withdrawing money would mean visiting the bank branch and
standing in a queue, especially the middle aged individuals and seniors are
reluctant to use online medium. On the other hand with banks churning out high
expenses for managing their ATMs across the country by employing security guards
and security cameras and other expenses to avoid theft and robbery attempts,
limiting the number of free transactions may not entirely be an unjustified
move, and banks will have to release part of this burden to users.
Banks Move:
Following the guidelines SBI has announced their decision to levy charges for
above 5 ATM usages a month, while the charges are not revealed. Other banks in
both the public and private sectors are still to make decisions regarding this
and are in a wait-n-watch mode. Though they are yet to make a decision on the
fee, banks are likely to adopt a decision soon and reviewing the patterns, as
they have the permission from RBI and also as an attempt to balance the expenses
they are facing in maintaining ATMs. Compared to private sector banks, the
public sector banks are likely to come up with quick decisions in this regard,
as already some banks like the Bank of India has commented about this to media.
But some sources reveal that HNI clients of banks may be freed from this
charging.
A Little Care to Save:
Forthe metroites it is time to change their ATM usage habit as sooner or
later the banks may embrace the new RBI guidelines. Here are some tips for
individual account holders to minimize their bank ATM usage and avoid payment on
an ATM usage fee for exceeding the free usage limit.
Restrict ATM usage: A lot of people visit the ATM located
outside their bank branch for cash withdrawals. If you are having this habit for
convenience, or if other bank ATM is located close to your office, it is time to
change your way. Also, next time when you are about to withdraw a good chunk of
money, use the teller’s service inside the branch instead of ATM.
Do not use ATM for mini statement or balance enquiry: Many
people have the habit of using ATMs for checking the account balance or getting
access to their account mini statement while on the go. And there can be many
unwanted visits, especially if you have an ATM close to your office. While
technology is making a convenient checking option at your finger tips, using
Smartphones and tablets, isn’t it sensible to acoid this old habit? Instead of
checking statement or account balance from an ATM get access to online or mobile
banking for getting a complete insight into your account. People using
Smartphone can install the official bank application of their bank and check
their account balance and statement while on the move.
Avoid cash transactions: Prevention is better than cure goes
the famous saying. Try avoiding cash transactions wherever possible. Opting any
from the multiple other methods of payments like using credit cards, debit
cards, cheque or NEFT to make sure you limit the number of ATM transactions per
month.
Withdraw higher quantum of cash per
ATM visit: If you are one of those withdrawing small amount of cash per
each ATM visit, it time to change the habit for good. Make sure you withdraw
substantial amount for every ATM transaction so as to limit your frequent ATM
visits. Since the number of free ATM transactions is limited to five per month
for the home bank branch, it is a good idea to withdraw enough cash from the ATM
that can manage your financial needs for at least a week.
