ATM transactions may get costlier as operators seek hike in inter-bank fees

The representation is being led by National Payments Corp of India after meetings were conducted separately for private and public sector lenders

 A security guard reads a newspaper inside an ATM counter as a notice is displayed on an ATM in Guwahati

economy news: In a move that might potentially add some more burden on the common man, the automated teller machine (ATM) operators, especially those of the private banks, are demanding a raise in inter-bank charges for ATM transactions, citing demonetisation, an increased cost of operating the channel, and fewer withdrawals.

The representation is being led by the National Payments Corp of India (NPCI) after meetings were conducted separately for private and public sector lenders.

The inter-bank fee is charged by one bank from another for use of its ATMs by the customers of the other. Any raise in this leads to increased cost burden for banks with smaller ATM networks. If banks pass on part of this cost to consumers, the number of free ATM transactions they are allowed to make in a month at their bank or other banks’ ATMs might get reworked.

Also readNo charges on debit card transactions up to Rs 2,000: FinMin

According to a Livemint report, the demand for raising the rate is being led primarily by private sector banks. Some large public sector banks are against an increase as it would lead to higher costs for them.

A banker from one such large public sector bank was quoted as saying that their charges were already high and if they increased it further, they would be bound to lose. Once they have ascertained the costs, they would discuss it with the stakeholders and fix the rate, he added.

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