CM Stalin Critiques Centre Over ATM Fee Increase
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Synopsis
On March 30, Tamil Nadu CM M.K. Stalin criticized the RBI's decision to raise ATM withdrawal fees from Rs 21 to Rs 23, calling it an act of 'institutionalised extraction.' He warned that such policies harm the poor and undermine financial inclusion, particularly affecting welfare program beneficiaries.
Key Takeaways
- CM Stalin condemns RBI's ATM fee hike.
- Charges increased from Rs 21 to Rs 23 per transaction.
- Criticism of Centre's digital initiatives as harmful.
- Hike impacts financially vulnerable populations.
- Discussion on financial inclusion and digital banking's effects.
Chennai, March 30 (NationPress) The Chief Minister of Tamil Nadu, M.K. Stalin, has vehemently criticized the Reserve Bank of India’s (RBI) recent decision to permit banks to raise fees for ATM withdrawals exceeding the monthly complimentary limit—from Rs 21 to Rs 23 per transaction—starting May 1.
In a social media post on Sunday, CM Stalin denounced the Centre’s digital initiatives, labeling them as an “institutionalised extraction” from the underprivileged.
He pointed out that while the Centre initially motivated citizens to open bank accounts, it subsequently introduced demonetisation and advocated the Digital India initiative.
“What ensued were fees on digital transactions, penalties for insufficient balances, and now this increase in ATM withdrawal fees,” he remarked.
CM Stalin cautioned that such actions would compel individuals to withdraw more money than necessary, particularly affecting the poor and economically disadvantaged populations.
“This decision undermines the very objectives of financial inclusion,” he asserted.
The Chief Minister highlighted that the rise in ATM charges would particularly impact beneficiaries of welfare programs such as the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), which is already experiencing funding shortages, and those receiving cash transfers under Tamil Nadu’s Kalaignar Magalir Urimai Thittam.
“This is not digitisation; it is institutionalised extraction. The poor swipe, the rich smile,” CM Stalin stated.
Previously, banks were allowed to charge customers Rs 21 per transaction after they exceeded their monthly allowance of five free ATM withdrawals from their own bank’s ATMs. Under the updated regulations, customers will incur charges of up to Rs 23 per withdrawal beyond this limit.
As per the RBI circular released last Friday, customers are entitled to five complimentary ATM transactions each month (inclusive of both financial and non-financial transactions) from their own bank’s ATMs. Furthermore, they are eligible for free ATM transactions at other banks: three in metropolitan areas and five in non-metropolitan regions. The new charges will also be applicable, with necessary adjustments, to cash recycler machines, excluding cash deposit transactions, the RBI stated.
Critics argue that the hike in withdrawal fees, while seemingly minor, disproportionately affects lower-income individuals who depend on ATMs for accessing government assistance and daily financial transactions.
CM Stalin’s comments have reignited discussions on whether the push for digital banking is unintentionally widening the financial gap instead of closing it.
