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Banks can charge customers for ATM transactions

1Reserve Bank of India does not have any objections to banks charging reasonable fee on bank customers for transactions at ATMs in order to make ATMs a viable proposition. Deputy governor K.C. Chakrabarty said if banks charge a reasonable fee on ATM transactions then the RBI will have no objections. He, however, said so far no request has reached the central bank on this count. He added that ideally, the issue of charging customers for ATM usage should be left to competitive market forces and banks should be allowed the liberty to decide their own offerings. Banks have been told to enhance security at ATMs and post guards round-the-clock in the wake of an attack on a customer at an ATM in Bangalore. Banks feel providing such security measures at ATMs will add to the cost of maintaining ATMs. Banks are contending that it would be unfeasible to have 24-hour security at ATMs and in case it becomes mandatory they may have to charge the customers on a per transaction basis or even closing down certain ATMs at non-peak hours. A bank pays Rs 15 plus taxes for every transaction to the other bank even for the free transactions.

Banks are discussing the issue at the Indian Banks Association.

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