RBI TO PONDER UPON FREE ATM TRANSACTIONS

The recommendation of Indian Banking Association is on table before RBI , to charge ATM transaction needs , serious debate. As banking authorities release data, it shows that charges per transaction has increased over the years. RBI direction to put armed guard at every ATM has increased ATM maintenance cost of Banks.

Banks are there to do business and to support business. The pure and neat aim of every bank is to make profit and that is possible only when a bank will serve its customers most. Every service has its cost and that too be charged as per the benefits and cost comparison. Each kiosk of ATM has its cost( nearly Rs. 40,000 per ATM averagely per month).

There are three types of transactions normally found in Banking system. Branch visits for cash transaction, ATM transaction,mobile transaction and net transaction. The cost of all are also in same sequence. Over some years, it has been found that ATM transactions has been increased to great extent. while mobile and net transactions are at a infantry stage.

At present , there are 5 free transactions for other banks ATM and all free transactions for own Banks for Saving Account. All India Bank Association has recommended to charge all transactions to sustain ATM services. In India nearly 75 out of 100 people are living average life and are very sensitive to cost escalation. Once ATM transaction will be charged customers will rush to bank branches and that will add to the cost. Comparison of that cost is inevitable. It is recommended that claque book cost should be increased drastically to compel people to use ATM. More the transactions less the cost and thus easy to sustain ATM. Secondly Account holder will also think about petrol expenses and time consumption as a cost of each visit of bank branches.