If you also use ATM frequently, then this news is very important for you! Now withdrawing money from an ATM is going to be heavier on your pocket. The Reserve Bank of India (RBI) has allowed banks to increase the fee charged for withdrawing cash from ATM by ₹ 2 from May 1, 2025.
This means that after the free monthly limit is exhausted, you will have to pay ₹ 23 on every additional withdrawal. RBI has issued instructions to banks in this regard on Friday. So, start controlling your withdrawal habits from now on, otherwise, your pocket may get loose.
₹ 2 extra on every withdrawal after the monthly limit
This fee will be levied on withdrawing money from ATMs after the limit of free withdrawals in a month is exhausted. Customers are eligible for a maximum of 5 free transactions (including financial and non-financial transactions) every month from their bank’s ATM.
They can do 3 free transactions in metro cities and 5 free transactions in other places. Banks charge fees for doing more transactions than this. Now this fee is going to increase by ₹ 2, which will have a direct impact on your monthly budget.
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New rules will come into effect from May 1
In a recent circular, RBI said – Apart from free transactions, a maximum of ₹ 23 can be charged to the customer on each transaction. This change will be effective from May 1, 2025. Currently, after the customers exhaust the limit of free transactions, banks are allowed to charge a maximum of ₹ 21 on each transaction.
RBI has also clarified that these instructions will also apply to transactions done on ‘cash recycler machines’ (in addition to cash deposit transactions) with necessary changes. This means that now even withdrawing money from cash deposit machines may cost you more if you have exceeded the free limit.
Transaction rules between banks
RBI has also issued instructions on the interchange fee structure for ATM transactions. The circular states that the ATM interchange fee will be decided by the ATM network. The current interchange fee for financial transactions is ₹17 per transaction and ₹6 for non-financial transactions across all centers.
This RBI circular applies to all commercial banks like ICICI, HDFC, SBI, PNB, RRBs (Regional Rural Banks), cooperative banks, authorized ATM network operators, card payment network operators, and ATM operators.
Interchange fee is the fee that a bank pays to another bank when its customers use another bank’s ATM. This fee is ultimately recovered from the customers when they exceed the limit of free transactions.
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