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Mr. R. Karthikeyan has forwarded me an important news from the Economic Times. Thank you very much Mr. Karthikeyan.
BANKS will now have to pay accountholders a compensation of Rs 100 per day for every day of delay in reversing a failed ATM transaction.
The Reserve Bank of India (RBI) has imposed stringent penalties on banks who fail to reverse a transaction where cash is not dispensed by the ATM but the customer’s account gets debited within 12 days.
In a circular issued on Friday, RBI has said banks must re-credit such customers’ accounts within 12 working days from the date of receipt of the complaint.
The circular is in response to complaints from customers who had to put up with delays in getting back money erroneously debited during failed ATM transactions. Besides imposing the stiff penalty, the central bank also made it clear that this amount needs to be credited to the customer’s account automatically on the day of the re-credit without the customer having to make a claim.
In case the delay is because of a third-party bank ATM through which the customer has transacted, the card-issuing bank must still pay the penalty to the customer. However, it will recover this amount from the bank that owns the ATM.
Similarly, if a non-bank network operator is the reason behind the delay, the bank will make the payment and recover the penalty from the operator.
Furthermore, the RBI has instructed banks to extend the scope of concurrent audit to cover cases of such delays. Banks are now also required to place a quarterly review of ATM transactions to its board of directors, indicating the quantum of penalties paid, reasons for the same, and the remedial action taken to prevent the recurrence of such cases. A copy will have to be forwarded to the central bank.
This apart, the Reserve Bank made a critical note of different banks setting different cutoff limits for permitting cash withdrawals from/for other bank customers.