Mumbai, Aug 21st: The Reserve Bank of India has put a limit on the third party ATM transactions saying that not more than 10,000 can be withdrawn each time they are used and limited such transactions to five a month ruling out its orders to make use of such transactions completely free which came to force from April 1 this year. The IBA chief executive said that the central bank has sent a communication in this regard to Indian Banks Association (IBA) and it is expected to be implemented shortly.

“Beyond five transactions, we propose to levy a transaction fee of Rs.20 per transaction for using another bank’s ATM,” said IBA deputy chief executive K Unnikrishnan. The Reserve Bank of India (RBI) has accepted the IBA proposal, but it will be implemented only by October, Unnikrishnan said on Friday. “It will be optional on the part of the banks to levy this charge on customers. We have not made it mandatory but left it to their (banks’) discretion,” Unnikrishnan said. He explained that since the RBI’s permission has been taken, it would not be improper on the part of banks to levy the charges if they wanted.

Keeping in mind of some customers who withdrew miniscule amounts, or made other kinds of inquiries which created several logistics problems causing avoidable expenditure for banks at the cost of the common user, the IBA submitted a proposal to RBI last month with is likely to be implemented from October.