Leading private sector banks – HDFC Bank , ICICI Bank and Axis Bank – have over the week announced new charges on cash transactions beyond certain limits.
Some banks, including HDFC Bank have begun charging a minimum amount of Rs 150 per transaction for cash deposits and withdrawals beyond four free transactions in a month.
The bank would also cap the third party cash transactions at Rs 25,000 per day
According to details on ICICI Bank website, there will be no charge for first four transactions a month at branches in home city while Rs 5 per thousand rupees would be charged thereafter subject to a minimum of Rs 150 in the same month.
For non-home branches, ICICI Bank would not charge anything for first cash withdrawal of a calendar month and Rs 5 per thousand rupees thereafter subject to a minimum of Rs 150.
At Axis Bank, the first five transactions or Rs 10 lakh of cash deposits or withdrawals would be free and charged at Rs 5 per thousand rupees or Rs 150, whichever is higher.
Customers will still continue to get at least five free ATM cash withdrawals at their bank ATMs and three at ATMs of other banks in the six metros, Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad.
The Reserve Bank of India had last capped the charge for additional transactions at ATMs at Rs. 20 plus taxes in 2007 and banks have been nudging the central bank to raise this ceiling.
These charges are for cash transactions in the branches, and not through ATMs.
Finance industry experts believe the brunt of the negative impact of the move would be faced by self-employed professionals and small businesses, while the salaried class might not face much inconvenience.