POS Withdrawal Limits Increased To Rs.2000 For Some Areas: RBI
In a surprising move, the Reserve Bank of India has increased the cash limits at point of sale (POS) units in tier III, tier IV, tier V and tier VI cities to Rs.2000 from erstwhile limit Rs.1000.
RBI said that this facility will be available for debit cards and pre paid money wallets issued by banks. POS terminals are basically units where in a debit holder can withdraw cash by swiping their debit/credit card at merchant locations.
Some merchants charge extra charges to their customers for the processing the payment from their bank and some don’t. The minimum limit is Rs.100 per day and the maximum limit is Rs. 1000 per day in all city areas. The relaxation of limit in tier III to Tier VI cities will facilitate the economic betterment in those areas. In tier I and II cities, the cash limit still stands at Rs.1000.
It has been reported that many banks especially SBI have been consistently requesting RBI to increase the limits so that it’s ATM’s can heave a sigh of relief from the space congestion and incessant money requests due to the low limit.
Also with this, the banks also have to shell out extra bucks for securing the ATM circuits and employing man power for the same.
On introducing this new cash limit, RBI said, “It is envisaged that the enhanced amount will add to customer convenience and aid recycling of cash in tier III to VI centres even as the push towards a less-cash society is pursued. This facility will be reviewed keeping in view the progress in e-payments and other related developments.”
The norm is to charge customers nothing more than 1% of the transaction amounts and the RBI also said that the merchants must display the availability of cash and it’s charges too for the customers who’d like to use this facility. The process of swiping your card at an ATM and at a POS come with the same PIN for most of the banks and the customers must provide their PIN for the transaction to be authenticated and successful.
This facility of drawing cash at POS terminals via debit card was introduced by RBI in 2009 and put up a limit of Rs.1000. In 2013, RBI added pre paid cards issued by banks into this POS system to ease up the way of paying.
With the introduction of the POS system, the merchant can easily process the transaction and avail the transaction credit to hit his bank account. This has definitively made a huge change in the way money can be withdrawn.
Currently India does not have POS terminals as much as it is supposed to have. China and Brazil have more POS terminals than India in the BRIC nations and this move certainly is a good move.