Mumbai: The Indian Banks’ Association (IBA), an industry lobby, has asked its members to impose a Rs10,000 cap per third party cash withdrawal from automated teller machines, or ATMs, beginning 15 October. Such withdrawals will also be capped at five a month. The IBA has sent a circular to its 150 members directing them to implement the decisions from mid-October, a person familiar with the development said.
Earlier this month, the Reserve Bank of India (RBI) had imposed a Rs10,000 cap per withdrawal from ATMs not owned by the bank in which the customer has an account, besides limiting such transactions to five in a month. The apex bank had sent a communication in this regard to Indian Banks’ Association (IBA).
IBA had submitted its recommendations to the central bank last month citing the financial burden faced by banks on account of huge number of third party usage and small-ticket withdrawals.
Beginning 1 April, RBI had declared third party ATM usage, including cash withdrawals and account enquiries, free for all customers and had said that banks can charge Rs18-Rs20 per month from other banks in case of third party ATM transaction.