A 4 min.read !

The decision by RBI to increase the charges on ATM transactions needs a relook.It is time a mechanism to ensure hassle free services through ATMs is contemplated and implemented along with the proposed hike in ATM transaction charges.

The various measures by the central bank from time to time to infuse and increase liquidity in the system such as pruning the interest rates across various segments of loans,maintaining a small margin between repo and reverse repo rates encouraging the bankers to lend lend and lend, attempts to contain and maintain inflation,facilitating the restructuring of loans during the pandemic,granting one more year to the stressed borrowers to service the debt etc are all laudable.

But the decision to raise the charges on using ATM machines to Rs 21 per transaction (retaining the existing provisions for free transactions from own bank and other bank ATMs) seems rather untimely. It is understandable that the hike is proposed as per the recommendations of the committee. But does the committee recommend any improvements in the services rendered through ATMs? Does the proposed hike or even a rupee more ensure a  hassle free service from ATMs? If the customer is charged for non compliance of the norms, should there be no reciprocation from the bank too for non compliance of services ? A contract or an accountability can not be unilateral and as such It should be a two way contract between the bank and the customer. 

Many banks, more so,some of the private banks are charging exorbitantly heavy amounts for insufficient monthly or quarterly balances or late payment charges for credit cards and the likes.Does the bank pay penalty to the customer in case the cash is not dispensed from the ATM or if the ATM goes defunct,at times for longer stretches? Is it not the bounden duty of the bank to ensure that cash is loaded and disbursed on time ? If this be the scenario in urban areas, what would be the impact on services in rural areas ?

It is quite a common phenomenon that many times ATMs in a row do not have cash or that they go defunct and at least even a message is not displayed outside so that the customers can understand the situation from afar without unnecessarily halting the vehicle, getting into the ATM, getting disappointed and then turning back frustrated ! Leave aside the courtesies and the accountability involved,there is another side for this issue which is the enormous savings in the fuel bill for the nation’s exchequer. With as many as 2,30,000 ATMs in the nation and with this kind of phenomenon so rampant and so frequent,imagine a number of vehicles unnecessarily halting and then restarting the journey which increases fuel consumption. Assuming that such a thing happens even at 1/10 th of ATMs (which is 23000ATMs),what would be the colossus losses incurred on fuel bill is any body’s guess ! It is well known that the fuel bill is to be paid in dollars and so there is a large undue outgo from the coffers.

It is in fact worth taking up a study by taking various factors such as the number of such halts per day, average waiting time at an ATM,the average number of ATMs at which it is taking place,the frequency of occurrence which would help estimating the actual fuel cost that may be saved besides improving the environs and ensuring a hassle free experience for the customers if these are avoided.Even a little savings is worth the effort in this direction.As fuel is precious,let us conserve it !

Now let us look at the economic gains for the nation by avoiding such frequent halts at less than just 600 toll plazas in the country ! The very underlying principle of FASTag is  this.As per the statement by the Honourable Minister for Road Transport,the nation is saving as much as Rs.20,000 crore annually by the introduction of FASTag besides the revenue for government getting boosted up by Rs.10,000 crore.Now that the savings involved are understood, it is in the nation’s interest and in the interest of the economy that this problem should be done away with as soon as possible let alone the convenience for the customers or the delicacies involved.

#banking #ATMservices #forabetterbankingexperience #hikeinATMcharges