In India, noncash transactions, such as balance inquiries, PIN changes and ministatement requests, must be included in the number of free transactions banks’ customers may conduct at other institutions’ ATMs, according to a directive from the Reserve Bank of India that takes effect July 1.
Previously, banks were required to give their customers five free cash withdrawals per month at other institutions’ machines, but there was no provision for other transaction types.
In response to the central bank’s directive, Mumbai-based HDFC Bank Ltd. said that beginning July 1 it would assess a surcharge to customers of other banks of 20 rupees (44 U.S. cents or 30 euro cents) for cash withdrawals and 8.5 rupees for every nonfinancial transaction. Other banks are expected to follow suit.
HDFC previously charged the same amount for cash withdrawals, but it charged nothing for nonfinancial transactions.
Though the central bank did not give a specific reason for the change in rules, media reports indicated that it did so under pressure from banks such as State Bank of India that have a vast network of ATMs across India. Those banks have indicated they have a higher cost burden than do banks that have a smaller ATM network because many more customers use the larger banks’ machines.
The central bank also ordered banks to resolve issues regarding failed ATM transactions within seven working days (
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