Hitherto, Branches were only the strategic outfits (Delivery Channels) and invariably the customers are required to visit the branches at the specified timings to complete their transactions. Extending service to the customers round the clock without presence of physical branch is called as “Alternate Delivery Channels”. Adoption of new delivery channels has become order of the day for banks to survive in the competitive environment to meet the emergent expectations of the customers besides achieving the optimum utilization of scarce resources.


ATM is an electronic device, which acts as an independent banker without any human intervention. ATM provides round the clock service throughout the year (24X7X365) to the customers. ATMs extend services such as Cash Withdrawal, Balance Enquiry, Cash/Cheque Deposit, Funds Transfer, Bill Payments, Payment of Direct Taxes, Mobile Recharge, Mobile Banking Registration etc. Cardholder needs to enter password for each financial transaction on ATM. It is a card used to with draw cash from ATM, purchase of goods and payment for services automatically debiting to the card holder’s bank account instantly.  The card holder can draw cash using the PIN from ATM up to the balance available in his account subject to daily caps prescribed by Bank from time to time. To provide further value added services to the customers, Banks are offering funds transfer facility through ATMs at free of cost. Under this, ATM/Debit Card holders can transfer funds Inter/Intra Bank using the card number of the beneficiary. There is no requirement for registration of beneficiary and the amount can be transferred instantly to any card number. As per RBI guidelines, Card to Card transfer limit is fixed as `5000/- per transaction and `25,000/- per month. For the benefit of persons of disabilities, RBI has made it mandatory for banks to have talking ATMs with Braille Keypads at all new ATMs installed from 1st July 2014.

RBI has issued guidelines to all banks not to levy service charges on ATM transactions of Savings Bank Cardholders. Other Bank Cardholders are allowed to withdraw cash on any ATM up to `10000/- per transaction. However, RBI has reduced the number of free transactions per month at non-home bank ATM to Three (3) w.e.f. 1.11.2014 in six metros viz., Mumbai, Kolkata, Chennai, Bangalore and Hyderabad. Five transactions per month are allowed free for Savings account holders in all other locations. Any transaction beyond the said stipulation (3 or 5) attracts charges @ `20/- per transaction (inclusive of service tax). With regard to transactions on home bank ATMs, the banks are given discretion to levy charges. The number of free transactions shall be inclusive of all types of transactions, financial or non-financial. However, it is not applicable to Basic Savings Bank Deposit accounts (Small/No Frill) and they continue to avail five free transactions. With this, the customer of a Bank has become customer of all Banks, which has paved the way for Any Bank Banking. Further, RBI allowed the banks to levy charges to their own customers for more than five transactions at their own ATMs also.

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