BIG NEWS..You will have to pay for withdrawing your money from ATM

New Delhi: People have been facing money crisis after the government decided to scrap old notes of Rs 500 and Rs1000 on 8th November last year. Since then, government has been setting limits over money withdrawal.

Here is something more painful news you need to know which might bring worry to your way. Government is considering a proposal to reduce the free withdrwals to more than half, including from banks where one has accounts.

According to a report in Economic Times, this proposal by bankers was discussed in the pre-budget consultations with the Finance Ministry.

"A proposal to bring down free ATM transactions to three per month has been discussed with the finance ministry, and this is one of the measures being considered to disincentivise use of cash," a senior banker said.

"Those free transactions were decided during a different era, but things have changed now and we need to change with that," another private banker said. "If only three free transactions are allowed, then people will be inclined to shift to digital transactions."

At present, most banks allow own customers five free ATM transactions every month after which a fee of Rs 20 per transaction is applied adding service tax. For non-customers, banks offer three free transactions in six metro cities- Mumbai, New Delhi, Kolkata, Bengaluru, Chennai and Hyderabad-and rest of the cities are given benefit of five free transactions.

Bankers believe that if only three free transactions are allowed per customer than people will be motivated for digital transactions.

Since demonetisation, banks have witnessed a drop of 10-20 percent in ATM transactions. Increasing transaction costs can help in droping the left over percent, but the government is however not interested to take that route.

News24Bureau