Will ATM transactions cost more from June 1? Viral claim debunked

With the COVID-19 pandemic impacting  incomes, it has become extremely crucial to save every penny that we have earned. None of us would appreciate getting overburdened by extra taxes or charges, directly or indirectly.

Facebook post claim

Recently, a Facebook post has surfaced which claims that from June 1, banks will charge Rs 173 as taxes and service charges – for every withdrawal from an ATM, beyond four transactions.

Several Facebook users shared the post. 

A Facebook post, originally written in Hindi, translates to, “Achhe din has started. Withdrawing money more than four times will invite a tax of Rs 150 and a service charge of Rs 23, which comes to a total of Rs 173. One more gift! From June 1, every bank transaction after four transactions will cost you Rs 150 more. Why don’t you slit people’s throats for once and all? Taxes on earnings, savings, bank deposits, and even if you want to withdraw your own money.”

However, the viral claim has been found to be fake and misleading.

Also Read: 7 things to know before opening a PPF account

RBI guidelines

Reserve Bank of India (RBI) guidelines say that banks (any) cannot charge customers more than Rs 20 per transaction for ATM transactions – over the free limit per month.

Bank’s ATM: As per the central bank, a minimum of five free financial transactions in a month should be offered to the savings bank account holders, for transactions at a bank’s own ATM.

Also Read: India’s GDP contracted 7.3% in 2020-21 as compared to 4.0% in 2019-20

Other Banks’ ATM: For transactions at other banks’ ATMs, a minimum of three free transactions in a month shall be offered to savings account holders. In the case of non-metro locations, it is a minimum of five free transactions per month.

In 2017, for every cash transaction, few private banks had started charging at least Rs 150 beyond four transactions in a month. There has been no change in rule.

Recently, the State Bank of India (SBI) has revised its regulations in case of cash withdrawals from its ATMs and branches and cheque book charges for basic savings bank deposits (BSBD) account holders. According to news reports, these amended regulations will be effective from July 1, 2021.

But as of now, there is no change in the charges for ATM transactions or for cash transactions in banks from June 1. Hence, the Facebook claim is misleading.