- Banks offer a certain number of free ATM transactions to their cardholders every month
- RBI has clarified that non-cash withdrawal transactions from ATMs such as balance enquiry cannot be part of free transactions
Banks offer their savings account customers a certain number of free transactions at ATMs every month and beyond that they levy charges. Now, the Reserve Bank of India or RBI has clarified the list of transactions at ATMs for which banks cannot charge their customers. “It has come to our notice that transactions that have failed due to technical reasons, non-availability of currency in ATMs, etc., are also included in the number of free ATM transactions,” RBI said in a notification on 14 August.
Banks cannot charge for these ATM transactions:
1) ATM transactions that fail due to technical reasons like hardware, software, communication issues will not be counted as valid ATM transactions for the customer, the RBI clarified. Banks cannot levy charges on these failed ATM transactions.
2) Other ATM transactions that failed due to non-availability of currency notes, invalid PIN/validations, and other transaction declines directly attributable to the bank or services provider will not be counted as valid transactions and cannot be charged.
3) Non-cash withdrawal transactions from ATMs such as balance enquiry, cheque book request, payment of taxes and funds transfer – which is part of ‘on-us’ transactions – shall also not be part of the number of free ATM transactions.
On-us” transactions refer to where the debit card and ATM are of the same bank.
At the end of March 2019, the number of ATMs stood at 2.22 lakh, down from 2.21 lakh in the previous year, according to the RBI’s latest report.
The RBI in its annual report said that banks can issue co-branded ATM cards in partnership with the authorized White Label ATM operators and may extend the benefit of ‘on-us’ transactions to the white label ATMs. ATMs set up, owned and operated by non-banks are called white label ATMs. “On-us” transactions refer where cardholder and ATM are of the same bank.