Banks liable for ATMs not being in working condition

Pushpa Girimaji

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Can I file a complaint against a bank for failing to maintain its ATM in proper working order? Last Sunday, I urgently needed to withdraw Rs 20,000 from my savings bank account and since I had already completed three free transactions from ATMs of banks other than my own, I went specifically to the ATM run by my bank, even though it was far, only to find that it was non-functional. Then I went in search of my bank ATM and after travelling quite some distance, found one, but even that was not working. Eventually, I had to go to another bank’s ATM and could withdraw only Rs 10,000. I had to borrow the rest of the amount from a friend. Earlier, too, I have had a similar experience with the ATM of my bank. To add insult to injury, every time I use another bank’s ATM, my bank sends me a message asking me to use only their ATM to avoid extra charges! I want to send across a strong message to my bank that they cannot get away with such shoddy service.

The Consumer Protection Act defines ‘deficiency’ as ‘any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance’ in relation to any service. Not maintaining an Automated Teller Machine (ATM) in good working condition constitutes deficiency vis-a-vis banking services and you have every right to demand compensation for the inconvenience and harassment caused to you on account of that deficiency or the ATM’s failure to dispense cash.

You can send your complaint to the consumer disputes redressal commission at the district level, seeking directions to the bank to maintain its ATMs properly and also pay damages to you for the hardship and suffering caused to you. The bank will also have to refund whatever it charged from you for using the ATM of another bank, besides costs of litigation.

A survey of the Reserve Bank of India (RBI) in 2016 had shown that almost one-third of the ATMs surveyed were not working. The RBI warned the banks against such a lackadaisical attitude towards customer service. But obviously, banks have not set their house in order. If you look at the annual report of the banking Ombudsman 2020-21, released in January this year, you will see that the maximum number of complaints received by the Ombudsman pertain to ATM cards and among these, grievances about ATMs not dispensing cash constitutes the largest category!

What kind of evidence do I need for such a complaint? In one instance, the ATM had a board outside saying ‘Out of order’ and I took a picture. But in the other case, it is only when I tried to draw cash that I realised that the ATM was not working. I do not have any evidence in terms of photographs.

Do not worry about that. Where you have evidence, you can provide it, otherwise you can state the date and the time at which you visited the ATM and found it to be non-functional. The bank cannot deny it. Every ATM enclosure has to have a functional closed circuit TV and you can ask for the footage of the dates you visited the ATM — it will show your failed attempt at drawing cash. You can also ask for the bank’s records on their maintenance schedules and the functioning of the ATM on the dates you tried to draw cash.

Please remember that the ATMs need regular servicing and maintenance to prevent software glitches and hardware problems and banks have a responsibility to ensure this. Failure to do so constitutes negligence on part of the bank and a consumer is entitled to compensation for any loss or inconvenience suffered on account of such negligence. Similarly, banks have to ensure that the ATM machines run by them are regularly replenished and there is no problem of ‘cash out’.

Only last year, the RBI advised banks to have a robust system of monitoring the availability of cash in the ATMs and ensure their timely reimbursement. The banking regulator also warned banks and white label ATM operators (those owned and operated by non-banks) that from October 1, 2021, ‘cash out’ at any ATM for more than 10 hours in a month will attract a penalty of Rs 10,000 per ATM.

So go ahead and take on the bank — it is sure to make your bank change its ways and pay more heed to customer service.