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ATM fee flub comes back to bite India's biggest FI

May 11, 2017

A new and poorly communicated schedule of ATM fees unleashed a torrent of outrage this week against the State Bank of India. The bank, India's largest, immediately sought to clarify the policy in order to quell condemnation by consumers, MPs and even Bollywood stars.

The public's fury focused on a notification that all cash transactions at SBI ATMs would be subject to a 25 rupee fee as of June 1. Confusingly, the memo also indicated that after four free transactions, cardholders would be charged 10 rupees per transaction at SBI ATMs and 20 rupees for each transaction at other banks' machines.

SBI clarified that the 25 rupee charge applied only to transactions carried out through State Bank Buddy an SBI mobile wallet whose release is pending, a report by Financial Express said.

Additionally, SBI said, the limit of four free transactions applied only to basic savings deposit accounts, and not to regular accounts, which would continue to be allowed eight free transactions monthly — five at SBI ATMs and three at other banks' machines.

It may be too late to do the PR damage to SBI, though, especially among the customers of five other Indian banks that recently merged with SBI, who one ATM user said were now being "cheated" in the same way SBI customers had been previously.

An MP decried the fees as "bullying," while one film star said the charges demonstrated an "anti-people policy."