ATM Fees, Debit Card Charges Make A Comeback – Has Govt Forgotten To Roll Back The Charges Or Its Plain Hypocrisy?
On the night of November 8th, when PM Modi announced demonetization and called for a national push towards a cashless economy, he also announced two very beneficial steps, which helped the citizens at large: No ATM fees on using ATMs (even other bank’s ATM), and no extra charge for paying via debit cards.
These were applicable only till December 31, 2016; and as 2017 as started, both of these charges have made a grand comeback.
Ofcourse, people are worried now, as a) Not all ATMs are providing cash, hence they need to go to other ATMs to withdraw cash and b) why are they being forced to pay extra for transacting via cashless mode?
On one side, Govt. of India is pushing for digital economy, and cashless transactions, and on the other side, there is an additional charge (or punishment) for being cashless?
Has Govt. forgotten to rollback these absolutely unnecessary charges, or it is plain hypocrisy from Govt.?
ATM Fee Is Back To Sting The Tax Paying Citizen
After paying various taxes on their income, the humble Indian citizen also needs to pay extra money to the banks for using their ATMs (something which was anticipated). Depending on the bank, a surcharge of Rs 15-20 is being charged after 5 ATM transactions from the same bank which gave you the ATM card.
After demonetization this additional ATM charge was rolled back, as getting cash was an issue, and it was still not clear when the situation would improve.
But, now, after January 1st, the same charges are back.
V Balasubramanian, president, transaction processing and ATM service, FSS said, “The first five transactions will be free of cost. After that it will be left to the discretion of the banks and the card category of the customer.”
Debit Card Charges Are Back To Haunt The Customer
One among the 11 major incentives for going cashless was no service tax and MDR (Merchant Discount Rate) on debit/credit card transactions.
Out of this, MDR waiver was only applicable till December 31, as now, merchants have started charging extra for debit card transactions. (credit cards have no MDR).
Although RBI has capped MDR to 0.5% for transactions upto Rs 1000 and 0.25% for transactions upto Rs 2000, the charges still exist. And, the merchants usually charge more from customers, when it comes to debit card transactions.
If salaries are being given cashless now, then what is the point of levying additional charges for doing cashless transactions? If the small trader can now save upto 46% of the tax by going cashless, then why there are no such benefits for the the end-user, the consumer for going cashless?
We will keep you updated as more details come in regarding this news..