State Bank of India may cut losses on ATM network by charging for transactions

State Bank of India (SBI) is considering charging customers for ATM transactions after admitting it is losing money on its ATM network.

With nearly 32,800 ATMs across the country as of September 2013, the bank has the largest ATM network in the country and still has ambitious plans for expansion.

Arundhati Bhattacharya, SBI chairperson, said: "Whatever services we give, ultimately it has to be a win-win situation.

"We just want a commercially viable model, I cannot afford to lose month after month."

Bhattacharya said that in all but a few states, the ATMs are losing money, although she did not specify in which states this was the case.

She said: "The loss from ATMs is very concerning. I would like to roll out many more ATMs. I am ready to do that, but I need to explain also how I am going to sustain this

"If you are looking at extending the ATM network and making it available to more people, there has to be a commercially viable model."

Meanwhile, the Reserve Bank of India is considering a proposal by the Indian Banks’ Association to implement a legal limit of five free ATM withdrawals per month, to cut down on the use of cash in the country.

A spokesperson said: "We will examine the IBA recommendation. Many other proposals have come.

"The whole idea is that people are using too much cash and adding to the costs. We’ll examine the issue."

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