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SBI rolls out tortuous ATM fee schedule following RBI rule changes

For customers with a low average monthly account balance, keeping the rules straight could be frustrating; for those with a heftier balance, they're as simple as f-r-e-e.

October 16, 2014

In August, the Reserve Bank of India announced new rules reducing the number of free on- and off-us ATM transactions the nation's banks were obliged to offer.

Now the country's largest lending bank, State Bank of India, has announced a sliding fee structure that it will apply to accountholders whose per-month withdrawals exceed the new limits of three free transactions at off-us ATMs and five at on-us ATMs.

New fees will take effect on Nov. 1, and will apply only to cardholders living in six metro areas designated by the RBI as subject to the new limits: Mumbai; New Delhi; Chennai; Kolkata; Bangalore; and Hyderabad. Elsewhere, the earlier limit of five free transactions will continue.

Starting Nov. 1, SBI customers in the six metros will be subject to the following fees:

• customers with an average monthly balance of 25,000–100,000 rupees ($404–$1617) will receive unlimited free on-us transactions and three free off-us transactions per month;
• customers with an account balance of more than 100,000 rupees will enjoy unlimited free transactions at any ATM, regardless of network; and
• Metro customers with an account balance of less than 25,000 rupees will pay 20 rupees (32 cents) for financial transactions and 8 rupees for nonfinancial transactions at other banks' ATMs once they exceed the three-transaction off-us limit. Beyond the cap of five on-us transactions, they must pay a flat fee of 5 rupees (8 cents) for both financial and nonfinancial transactions.

To encourage customers to visit an ATM rather than a teller window (or perhaps to keep ATM users from reverting back to the teller line to avoid charges), SBI has devised an additional, equally convoluted schedule of fees tied to branch visit and account balance numbers.