The Reserve Bank of India (RBI), in a customer friendly decision, has suggested banks to offer their ATM services (for cash withdrawals) to other banks’ customers free of charges from April 2009.
Also the banks, which are charging more than Rs 20 per transaction, for cash withdrawals, shall reduce the charges to Rs 20 for such transactions by March 31, 2008, said RBI on Monday, while releasing a draft paper on ‘ATMs of Banks: Fair Pricing and Enhanced Access’. “No bank shall increase the charges on such uses prevailing as on December 23, 2007,” added RBI. The central bank has taken such decisions after taking into consideration the falling costs and various international practices on ATM use. “In the public interest, the approach is to establish a fair and transparent framework for levy of service charges for ATMs such that it would encourage greater financial inclusion and promote enhanced access to ATMs,” explained RBI. According to the RBI, use of technology should, among others, lead to reduction in transaction costs to banks. Over a period, with the increasing adaptation of the people to the use of technology in their daily transactions, it is expected that there will be a further reduction in the transaction costs. In these circumstances, the regulator, by authorising the establishment of an ATM, has a responsibility to ensure transparency and fair charges for the use of ATMs. There is also a good case for establishing a greater level of transparency, in the context of adoption of technology, to enhance the level of financial inclusion. In this background, there is also a case for rationalising the service charges for ATM transactions such that it becomes affordable for the common man. Enhanced and cost effective access to ATMs plays an important role in technology based financial inclusion, said RBI. As at the end of October 2007, the number of ATMs deployed in India was 31,078. Commensurate with the branch network, larger banks have deployed more ATMs. Most banks prefer to deploy ATMs at locations where they have a large customer base. B.KARTHICK RESEARCH ANALYST WWW.KENCES1.BLOGSPOT.COM <http://www.kences1.blogspot.com/> --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups "Kences1" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/kences1?hl=en -~----------~----~----~----~------~----~------~--~---
