Effective May 1, 2025, withdrawing cash from ATMs other than your own bank will cost more. The Reserve Bank of India (RBI) has allegedly approved an increase in ATM interchange fees, and that means banks will charge more once you exhaust your free withdrawals.
What’s Changing?
If you withdraw cash at an ATM that doesn’t belong to your bank and you have already used your free transactions, you will have to pay more.
Rs 19 for the cash withdrawal (up from Rs 17).
Rs 7 for non-financial transactions (like balance inquiries, PIN changes, mini statements) (up from Rs 6).
(There will also be GST on these charges)
Who Will Be Affected Most?
It primarily will affect customers of smaller banks who will utilize ATMs of larger banks due to a lack of branches. This is happening at a time when ATMs in India are in decline as digital payments (UPI, mobile wallets, internet banking) take over.
Why Are ATM Fees Going Up?
Private ATM owners, referred to as white-label ATM operators, have asked for a fee increase owing to increasing operating costs. According to private ATM owners, it is becoming harder to operate ATMs at the current fee. The increase has been authorized by the Reserve Bank of India (RBI) in order to maintain ATM services.
How Do You Avoid Paying These Extra Fees?
You can avoid these charges by using any digital payment types like UPI, mobile banking, or internet banking that offer free digital pay options and are becoming increasingly popular every day.
The Limits For Free ATM Transactions Remain The Same
In metro areas, including Delhi, Mumbai, and Chennai, you may do 3 free transactions per month at other bank ATMs. In non-metro areas, you may do 5 free transactions per month at other bank ATMs, and there are no failures.
With the growth of digital payments in India, which increased from ₹ 952 lakh crore in FY14 to ₹ 3,658 lakh crore in FY23, people are using less cash. For individuals who still prefer cash withdrawals, the price increase will simply make ATM transactions a little more expensive.
