ATM Cash Withdrawals To Cost You More Very Soon

ATM operators nationwide are advocating for an increase in the interchange fee for cash withdrawals and have made appeals to both the Reserve Bank of India (RBI) and the National Payments Corporation of India (NPCI) for their support, as reported by The Economic Times.

The Confederation of ATM Industry (CATMI) is pushing for a rise in the interchange fee to a maximum of Rs 23 per transaction to bolster funding for the industry.

According to Stanley Johnson, Executive Director of AGS Transact Technologies, the interchange rate was last raised two years ago. "We have been in contact with the RBI, and it appears they are in favor of our proposal. CATMI has suggested raising the fee to Rs 21, while some other ATM manufacturers have proposed Rs 23," he stated.

"The previous increase took several years, but it seems there is now alignment, and approval for the fee hike is imminent," Johnson added.

In 2021, the interchange fee for ATM transactions was increased from Rs 15 to Rs 17. This fee is paid by the bank issuing the card (issuer) to the bank where the card is used to withdraw cash (acquirer). Moreover, the cap on the fee that can be charged to customers was raised from Rs 20 to Rs 21 per transaction.

Currently, in six major cities—Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, and New Delhi—banks provide a minimum of five free transactions per month to their savings account holders.