NEW DELHI: After the Reserve Bank of India (RBI) allowed banks to increase charges on ATM cash withdrawals beyond the mandatory free monthly usage, Tamil Nadu chief minister MK Stalin on Sunday said the move would “nullify” the objectives of the financial inclusion of poor people and termed it ” institutionalised extraction”.
“The Union Government urged everyone to open bank accounts. Then came demonetisation, pitching #DigitalIndia. What followed? Charges on digital transactions, penalties for low balances and now the RBI has allowed banks to charge up to Rs. 23 for ATM withdrawals beyond monthly limit,” Stalin posted on X.
“This will make people withdraw more than they need and in particular, negate the objectives of financial inclusion of the poor,” the DMK chief added.
Stalin further claimed that the ones to suffer the most due to the RBI’s move would be the MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) beneficiaries and beneficiaries of the DMK-led Tamil Nadu government’s KMUT (Kalaingar Magalir Urimai Thogai) scheme.
“This is not digitisation. It is institutionalised extraction. The poor swipe, the rich smile,” he stated.
The RBI on Friday permitted banks to increase charges on ATM (Automated Teller Machines) cash withdrawals beyond the mandatory free monthly usage to Rs 23, a hike of Rs 2, from May 1.
Customers are eligible for five free transactions (financial and non-financial) per month from ATMs of banks of which they are customers.
For cash withdrawals from ATMs of other banks, customers are allowed eight free transactions (financial and non-financial), including three in metro centres and five in non-metro cities.
