Govt turning banks into 'collection agents of loot': Kharge on ATM fee hike

The Congress on Saturday hit out at the Modi government after the RBI's decision to allow banks to increase charges on ATM cash withdrawals, and said banks have been reduced to "collection agents" to "loot" citizens.

Giving a list of charges levied by banks, Congress president Mallikarjun Kharge said a "painful" price rise and "unbridled loot" was the BJP's mantra.

"Our banks have been unfortunately made 'collection agents' by the Modi government! ATM withdrawal charges to be costlier," Kharge said in a post on X.

"The Modi government has extracted at least Rs 43,500 crore due to non-maintenance of minimum balance from savings accounts and Jan Dhan accounts combined, between 2018 and 2024," he said.

"Other bank charges to LOOT citizens - an inactivity fee, which is Rs 100-200 every year. Bank statement issuance fee is Rs 50-100. Rs 20-25 per quarter is charged for SMS alerts. Banks charge 1-3 per cent as loan processing fees," he added.

The Congress chief also claimed that if a loan is paid on time, loan pre-closure charges are levied by banks, and NEFT and demand draft charges are an additional burden. KYC updates like signature changes also attract fees, he claimed.

"Earlier, the Union government used to provide the data of the amount collected by these charges in the Parliament, but now this practice has also been discontinued by saying 'RBI doesn't maintain such data'.

"Painful Price Rise + Unbridled Loot = BJP's Mantra for Extortion!," Kharge posted.

The Reserve Bank of India on Friday permitted banks to increase charges on ATM cash withdrawals beyond the mandatory free monthly usage by Rs 2 to Rs 23 per transaction from May 1.

Customers are eligible for five free transactions (inclusive of financial and non-financial transactions) every month from their own bank Automated Teller Machines (ATMs).

They are also eligible for free transactions (inclusive of financial and non-financial transactions) from other bank ATMs -- three transactions in metro centres and five in non-metro centres.