In another blow that’s sure to sting literally all Indians holding debit cards, the government is planning to further reduce the number of free ATM transactions to just 3 per month.
Citing vague official reasons, the banks are putting pressure on the government to limit the number of ATM withdrawals by introducing a fee for more than 3 withdrawals per month.
Soon, you may be charged Rs.20 to Rs.50 (PLUS Service Tax) for withdrawing any amount of money from your own bank account at any ATM, once you finish your 3 free transactions. There is literally no reason for you to be charged under this heading of “withdrawal fees”, except for the banks to increase the amount they appropriate from unwitting and uninformed Indians under the guise of “improving the economics of doing business”.
We are seeing steps being taken to move to a wholly digital world where all our money is nothing more than a number on a screen and not physical notes that can be counted and kept protected in a safe. The benefits of digitizing an economy are many, but so are the pitfalls. Total monetary digitization would be fine, if:
- The money was secured beyond the ability of any hackers. This clearly isn’t the case if you consider the number banks that have been, and are still being hacked all over the world. Even SWIFT, the global messaging service that connects all banks, continues to identify brand new hacks every so often, the latest being the attack on Bangladesh’s central bank which lost $101 million.
- The money could be accessed charge-free. If going digital is mandatory, banks and digital payment partners should ideally allow users to withdraw their own money for free. If it’s a charge for the use of a service, logic dictates that the use of that service should be optional. Compulsorily charging someone to use a service is basically taxation, or by definition, a scam.
It seems that the days are not far when we see banks start charging for even checking your account balance at the ATM.
Small changes like this one, if they are allowed to happen, will only pave the way for more and more charges for things that used to be free.
The one question you should be asking yourself right now is this – “Why on Earth am I being charged so much just to access or deal with my own money?”