Business

SBI halves daily ATM cash withdrawal limit to Rs 20K

New Delhi, Oct 1 (Agencies) | Publish Date: 10/1/2018 11:46:32 AM IST

 In an attempt to address the growing incidence of ATM frauds and boost digital transactions, the country’s largest lender has just halved its daily ATM withdrawal limit. 

The State Bank of India has lowered the limit on its Classic Debit Card to Rs 20,000 a day, from Rs 40,000 previously, a report in the Economic Times said. The lower limit will be effective from October 31 and will impact many SBI customers since these cards constitute a sizeable chunk of the bank’s card portfolio.

“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 a bank communique sent out to its offices. SBI has also directed all its branches to display the message on notice boards.

The latest RBI annual report reveals that the currency in circulation (CiC) stood at Rs 19.38 lakh crore as of August 17, 2018, which is higher than the pre-demonetisation levels. Consequently, India’s currency to GDP ratio is once again among the highest in the world, compared to peer emerging market economies as well as advanced economies. Moreover, household savings held in the form of currency are at the highest level since 2011.

Although this restriction on cash withdrawals will come into effect just ahead of Diwali, the bank does not foresee any inconvenience to customers. “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,” SBI Managing Director PK Gupta told the daily.

He added that customers with a requirement for higher ATM withdrawals can switch to card variants offering the same. For instance, the SBI Platinum International Debit Card allows ATM withdrawals of up to Rs 1 lakh daily while the Gold debit card allows Rs 50,000 per day. Such cards are issued to those maintaining a higher minimum balance in their bank accounts.

Experts say that debit card users are most gullible when it comes to card frauds, and the risk is not limited to ATMs. Even retail point of sale terminals and mobile card swipe devices can fall prey to skimmers. Moreover, many debit cards still follow the magnetic stripe technology, which is more prone to frauds than the newer chip-based cards.

The development comes a day after the police yesterday arrested two more Romanian nationals involved in an ATM skimming racket. In fact, industry insiders peg the loss from skimming - where devices are planted in ATMs to surreptitiously read card data, which is then cloned to swindle money - at over $2 billion a year.

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