Before November 8, several banks, including State Bank of India, Punjab National Bank and ICICI Bank were charging Rs 15 per transaction as they had a wider ATM network and larger user base than other banks, who mostly charged Rs 20 per transaction.
The RBI has said that merchant discount rate on transactions will be capped at 0.5 per cent for transactions up to Rs 1,000, and 0.25 per cent for Rs 2,000 in 2017. However, although the MDR has been capped, merchants on many occasions have not passed down the waiver to customers before or after December 31. The RBI had waived all transaction charges for debit and credit cards up till the year's end, but several customers complained of being charged by jewellery and clothing retailers.
"The market was expecting the waiver on ATM transaction charges to continue even after December 31," Navroze Dastur, managing director, NCR Corporation, India and South Asia, told The Economic Times.
Speaking with The Economic Times, 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. Banks generally have an agreement with individual customers on charges levied. Many banks were not charging premium customers before demonetisation."
"Cash is not freely available. There are only about 20 per cent of ATMs operational. The government should seriously look to subsidising digital transactions by creating the Dipayan fund, as recommended by Ratan Watal. Because if going digital is a forced measure, customers should not be bearing the full cost of it," Balasubramanian added.