If you frequently withdraw money from ATMs, here’s an important update for you.
Starting May 1, 2025, withdrawing money from ATMs will become more expensive as the Reserve Bank of India (RBI) has decided to increase the ATM interchange fee.
This fee hike comes in response to the rising operational costs of ATMs.
What is ATM Interchange Fee?
The ATM interchange fee is the charge a bank pays to another bank when its customer uses the ATM of a different bank.
For example, if you withdraw cash from an ATM of a bank other than your own, your bank pays a fee to the bank that owns the ATM.
Typically, banks charge customers for this service, especially when they exceed the limit of free transactions.
How Much Will the Charges Increase?
From May 1, 2025, the charges for ATM transactions will go up as per the new RBI guidelines:
Cash withdrawal fee: From ₹17 to ₹19 per transaction.
Non-financial transactions (like checking balance or printing a mini statement): From ₹6 to ₹7 per transaction.
What is the Limit for Free ATM Transactions?
RBI allows customers a fixed number of free ATM transactions each month without any additional charges:
Metro cities (Delhi, Mumbai, Kolkata, Chennai, Hyderabad, Bengaluru): You can make 3 free transactions (including both financial and non-financial) from ATMs of other banks.
Other locations: You can make 5 free transactions from ATMs of other banks.
Once you exceed this limit, you will have to pay the increased fees.
Will Charges Apply to Failed Transactions?
Many customers worry about charges for transactions that fail due to reasons like network issues, technical faults, or insufficient cash in the ATM.
RBI has clarified that no fees will be levied on transactions that fail due to technical problems or other reasons beyond the customer’s control.
Promoting Digital Banking
This increase in ATM charges is likely to encourage more people to switch to digital banking methods.
Options like UPI, mobile banking, internet banking, and WhatsApp banking offer easy ways to conduct transactions without relying on ATMs.
By making digital payments, customers can save money on ATM charges and enjoy a quicker, more convenient experience.
So, if you frequently use ATMs, be prepared for the upcoming fee increase and consider embracing digital payment methods for your transactions!
