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Banks to Charge Cash Transaction Fee

Banks to Charge Cash Transaction Fee

The increased traffic brings in its wake, a lot of pangs. That’s not only true for the traffic on the roads but also the traffic inside the banks. Serpentine queues, long waiting times mar the banking experience. The bank employees on the other hand struggle to keep the tempers down especially when the wait for the customer gets excruciatingly long.

The latest cash withdrawal fee is set to kill two birds with one stone. One, it will obviously enhance the revenue for the bank. Two, it will keep customers away from the branches.

The Big 3 in the Indian private sector banking market space; ICICI Bank, HDFC Bank and Axis Bank, have asked their customers to shell out money if they withdraw or deposit money more than the stipulated free transactions.

HDFC Bank customers will be charged Rs 150 per transaction after four free cash transactions, while Axis Bank has allowed five free cash transactions.

The logic of imposing the fee is evident when one browses the report published by The Hindu a couple of years back. “On an average, a branch banking transaction costs a bank about Rs 40-50 per customer, while an internet or mobile transaction brings down the costs to Rs 15-30 per customer,” stated the report.

Apparently, the senior citizens would be worse affected by the move as they do not like the idea of using the ATM. Needless to say, they are not conversant with the online modes of cash transactions.

The reality is that the cash transaction fee is here to stay and Kotak Mahindra Bank is all set to jump on to the bandwagon with effect from April 1, 2017.

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