Hindu Business Line: Thiruvananthapuram: Thursday, 12 March 2015.
The Competition Commission of India (CCI) is
investigating if banks have been acting as a cartel in fixing lending rates in
recent times. The competition regulator confirmed this in response to an RTI
query furnished by activist S Dheenadhayalan.
The activist wanted to know if the Commission has
initiated any suo motu inquiry into reports citing possible unfair practice by
banks which have been quoting mostly similar lending rates. “The issue of
banks’ similar interest rates (sic) is under investigation by the Director-General,
CCI, in suo motu case No 01/2015,” a communication addressed to Dheenadhayalan
said.
Queried for information of the nature of
deliberations within, the Commission said the “case is under investigation and
is therefore exempt from further disclosure.”
ATM policy
Dheenadhayalan told BusinessLine that the CCI was
also invoked on the issue of sectoral regulator RBI rationalising the use of
ATMs. He was told that this petition also was being processed at the CCI.
He had submitted that the RBI had in a directive
on March 10, 2008, spoke of an ideal situation “where a customer should be able
to access any ATM installed free of charge through an equitable cooperative
initiative by banks.” Rationalising ATM use would go against this policy; it
could also affect the operational autonomy of individual banks.
The RBI had proceeded to act through a directive
on August 14, 2014. This came about after the Indian Banks’ Association sought
some changes in existing instructions with regard to free transactions at other
bank ATMs.
Free transactions
It had referred to the growing cost of ATM
deployment and maintenance incurred by banks as well as the rising ‘interchange
outgo’ due to these transactions. The IBA had sought the removal of free
transactions at other bank ATMs at metro centres and other large townships.
After an analysis of the ATM deployment in the
country as well as availability of alternative means of electronic payment
infrastructure and access, the RBI revised the existing directions.
The number of free transactions for accountholders
at other bank ATMs was reduced from five to three a month in six metro centres.
The RTI activist said this set a wrong precedent and sought relief, requesting
that the matter may be taken up with the RBI.
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