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IndiaCap on ATM withdrawals a policy decision: RBI to HC

Cap on ATM withdrawals a policy decision: RBI to HC

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Cap on ATM withdrawals a policy decision: RBI to HC

New Delhi, Dec 5 (PTI) The RBI today told the Delhi High Court that the cap on free-of-charge withdrawals from ATMs by banking customers was a “policy decision” and the court should not interfere in it.

The Reserve Bank of (RBI) counsel also raised the issue of “maintainability” of the petition which has sought directions to allow banking customers to make unlimited number of transactions free of any charges on their own bank ATMs.

“It is a policy decision. Why should the court interfere in it? They (petitioner) are challenging the circular of the RBI. I am challenging the maintainability of this plea,” the RBI counsel told a bench of Chief Justice G Rohini and Justice Sangita Dhingra Sehgal.

The bench, however, said it would hear the matter on April 12 next year as the main counsel for the petitioner, advocate Swati Aggarwal, was not available today.

As per RBI's new guidelines, bank customers in six metros — Delhi, Mumbai, Chennai, Kolkata, Hyderabad and Bengaluru — are allowed to withdraw money free of charge only five times a month from their ATMs and every transaction beyond this limit will be charged Rs 20 per use.

During the hearing today, the RBI counsel said besides the five free transactions from one's own bank ATM, customers can avail three free withdrawals from ATMs of other banks.

The RBI had earlier told the bench that the ATM facility was made available with a view to reduce “cash usage and increase electronic transactions in the country”.

India's central banking institution, which controls the monetary policy of the rupee, had opposed the PIL saying it is “not maintainable and is liable to be dismissed, as RBI has not violated any laws of the land”.

In her PIL, Aggarwal had claimed that the guidelines were issued at the behest of a few banks and IBA (Indian Banks Association) which had approached RBI seeking changes in the extant instructions regarding free transactions at other banks' Automatic Teller Machines (ATMs).

It has alleged that levying charges was highly “arbitrary and unjustified” besides being “discriminatory and against good banking practices and reforms and a backward move”.

The plea has said, “In almost all modern economies of the , there is no cap on the number of transactions one can make on own bank ATM and unlimited number of transactions remain free of charge on their own bank ATMs”.

It has contended that RBI decision is contradictory to its own earlier circular dated March 10, 2008, whereby it had “justified and given directions allowing the free usage of ATMs for unlimited number of transactions on own bank ATMs”.

Northlines
Northlines
The Northlines is an independent source on the Web for news, facts and figures relating to Jammu, Kashmir and Ladakh and its neighbourhood.

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