The misery is awaiting millions of bank account holders across India now: from May 1, 2025, withdrawing cash from ATMs will become more burdensome on the wallet. This change was instituted after the Reserve Bank of India (RBI) granted approval to the banks for revising ATM transaction charges, considering repeated representations made by banks for increasing operational costs. Hence, here comes heavier charges for customers over and above the free withdrawal limit.
All that you need to know about the new ATM withdrawal charges coming into effect from May 1.
What Has Changed?
Currently, most of the banks allow five free ATM transactions at their own ATMs (financial as well as non-financial ATM transactions) in a month in metro cities and three free transactions for ATM transactions against another bank. Now, once the ATM withdrawals exceed the prescribed free limit, the banks deduct about ₹21 for every additional transaction made.
From May 1 onward, the banks will charge ₹24 after the free transactional limit. Such changes on charge structure shall be applicable for all customers, whether savings or current.
New ATM Withdrawal Charges — Key Highlights
- Free Transaction Limit: Same as before; 5 transactions at own-bank ATMs and once again 3 at other-bank ATMs on a metro basis.
- Charges Beyond Free Limit:
- Old on the Previous Regulation: ₹21.00 per transaction
- New Charges (Effective from 1st May): ₹24.00 per transaction
- There may be a difference in terms of charges on non-financial transactions for the respective ATM after exhausting the free limit as far as this may vary from one bank to another.
What Is The Justification For This Increase?
Now, the maintenance of ATM infrastructure pertains to high operational costs on account of securing it, upgrading the software, cash handling, and compliance. The new charges should assist banks in recovering some of these operating expenses.
This revision is also, per RBI guidelines, in line with the general increase in inflation and other input costs affecting the banking firms in their day-to-day operations.
How To Waive Off Extra Charges?
As ATM charges are concerned:
- Plan your ATM cash withdrawals in such a way that your free transaction limits never get breached.
- Make digital payments for whatever you can.
- Try to go for a larger amount every time for less frequent visits to the ATM.
- Stick to the ATM of your own bank to maximize usage of the limit.
Conclusion
On the one hand, the fee hike seems paltry, but on the other hand, taken into account by anyone who prioritizes their visit like the ATM; it soon adds up. Therefore, customers are advised to keep themselves uptodate about the free withdrawal limits and the new charges effective May 1, 2025, to keep that little extra deduction under control.
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