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The Indian Banks' Association reportedly has petitioned the Reserve Bank of India to put curbs on free cash withdrawals at third-party ATMs. Since April 1, cardholders in India have been allowed to withdraw cash and check account balances without having to pay surcharges. According to Business Standard, a national Indian newspaper, association representatives met with Reserve Bank of India officials last month to request changes to the free-ATM rule because of a spike in the number of transactions but a fall in the ticket value of each transaction. Among their suggestions is capping each withdrawal at a third-party ATM to 10,000 rupees (US $200) and limiting the number of free third-party transactions to five per month. The Indian Banks' Association refused to comment officially to CardLine Global about the reported proposal. However, a Reserve Bank of India official, speaking on condition of anonymity, confirmed to CardLine Global specifics of the association's proposal. "However, it does not look like the suggested changes will be accepted by the [Reserve Bank], as they may not be populist measures," he adds. Prathima Rajan, an India-based analyst with U.S.-based research firm Celent LLC, tells CardLine Global [the Reserve Bank] might not accept this proposal because setting limits on withdrawals would be inconvenient to consumers. "Setting a transaction limit of five per month will discourage customers from using other banks' ATMs as they will not be keen on keeping track of transactions in a particular month," she says. "Since the proposed suggestions are not pro-customer, it is unlikely that the central bank will amend such proposals," she adds.
