RBI Approves Hike in ATM Withdrawal Charges Effective May 1, 2025
Significant changes to banking regulations have come into effect from today, with the Reserve Bank of India (RBI) approving a revision in ATM cash withdrawal charges. The updated norms primarily affect charges applicable on ATM transactions that exceed the monthly free limit for customers.
Under the new rules, the fee for ATM withdrawals beyond the prescribed free transactions has been increased from ₹21 to ₹23 per transaction (plus applicable taxes). The revised rates, which came into force on May 1, 2025, aim to reflect the growing operational costs associated with ATM maintenance and security.
In a statement issued earlier, the RBI confirmed:
“If transactions exceed the free limit, a customer may be charged a maximum of ₹23 per transaction. This comes into effect from May 1, 2025.”
Currently, customers are allowed a limited number of free ATM transactions each month—three in metro cities and five in non-metro areas. Once this limit is surpassed, the revised charges will apply.
Additionally, changes have been made to the ATM interchange fee structure. Interchange fees are the charges a bank pays another bank when its customer uses an ATM that does not belong to their own bank. These remain at ₹19 for financial transactions and ₹7 for non-financial transactions, as per existing rates. These charges are determined by the ATM network and not directly imposed on customers but affect the broader cost structure for banks.
The central bank clarified that the decision to increase withdrawal fees was made after careful consideration of the increasing costs related to ATM infrastructure, including enhanced security requirements and technology upgrades.
Customers are advised to monitor their ATM usage closely and remain within the free transaction limits to avoid additional charges.
