New Delhi: The State Bank of India (SBI) has lowered the ATM cash withdrawal limit to Rs 20,000 a day from Rs 40,000. According to a report, the lower limit will be effective from October 31, in view of spurt in fraudulent transactions at ATMs and to encourage digital and cashless transactions.
“In view of the increase in the number of complaints received by banks around fraudulent transactions at ATMs and to encourage digital and cashless transactions, it has been decided to decrease the cash withdrawal limits of debit cards issued or being issued on ‘Classic’ and ‘Maestro’ platforms,” said SBI official told Economics Times.
The restriction comes weeks before the festive season.
SBI managing director PK Gupta told ET, “Our internal analysis shows most actual withdrawals are of smaller amounts. So, Rs 20,000 should be adequate for most customers. We are trying to see whether smaller withdrawals could minimise frauds.”
He said customers with a requirement for more can ask for card variants that offer higher withdrawal limits. Such cards are issued to those keeping a higher minimum balance in their bank accounts.
Meanwhile, people's demand for cash continues to head northwards, despite frequency of digital transactions going up. A Reserve Bank of India (RBI) data in April 2018 revealed that people's demand for cash was 7 per cent higher at Rs 18.25 trillion at the end of April compared to Rs 17 trillion at the beginning of November 2016.
As of May 2018, banks have distributed a total of 37.5 million credit cards and 861 million debit cards.
In August, the Home Ministry notified that no ATM would be replenished wish cash after 9 pm in cities and 6 pm in rural areas from next year even as two armed guards will accompany crisp notes in transit.
The deadline for putting money in the ATMs located in Naxal-hit areas will be 4 pm while private cash handling agencies have to collect money from the banks in the first half of the day and transport notes only in armoured vehicles. This, the Home Ministry said would come into effect from February 8, 2019 in view of the spurt in incidents of attacks on cash vans, cash vaults, ATM frauds and other internal frauds leading to increased sense of insecurity.