RBI Implements New ATM Transaction Rules Starting May 1
Starting May 1, 2025, the Reserve Bank of India (RBI) will implement a revised framework for ATM transaction charges, significantly altering the landscape for customers across the nation. The new guidelines will establish limits on free transactions, introduce fees for additional transactions, and modify the interchange fee structure. Customers will have a set number of free transactions each month, with banks permitted to charge for any transactions exceeding these limits.
New Free Transaction Limits
Under the updated regulations, customers will enjoy three free ATM transactions per month in metropolitan areas and five in non-metropolitan regions. These free transactions encompass both financial and non-financial activities. Once customers exceed these limits, banks will charge up to Rs 23 per transaction, plus applicable taxes. This fee structure applies to all transactions, including those conducted at Cash Recycler Machines (CRMs), with the exception of cash deposits. Major banks, including HDFC Bank, Punjab National Bank (PNB), and Kotak Mahindra Bank, have begun notifying their customers about these changes.
Bank-Specific Charges and Policies
HDFC Bank has announced that starting May 1, 2025, the fee for ATM transactions beyond the free limit will increase from Rs 21 plus taxes to Rs 23 plus taxes. The bank clarified that at its own ATMs, only cash withdrawals beyond the free limit will incur charges, while non-financial transactions will remain free. However, at ATMs of other banks, both financial and non-financial transactions will count against the free transaction limit. Similarly, PNB has stated that charges for transactions exceeding the free limit at other banks’ ATMs will be Rs 23 for financial transactions and Rs 11 for non-financial transactions, effective May 9, 2025. IndusInd Bank has also updated its policy, stating that all customers will incur a charge of Rs 23 for ATM cash withdrawals at non-IndusInd Bank ATMs beyond the free limits starting May 1, 2025.
Advice for Customers
As these changes come into effect, customers are encouraged to monitor their ATM usage, particularly at ATMs of other banks in metropolitan areas. They should be aware of the Rs 23 cap on charges for transactions that exceed the free limit. It is also important to note that these charges will apply at CRMs, excluding cash deposits. The RBI’s initiative aims to streamline ATM usage fees while promoting the adoption of digital banking alternatives.
Trends in ATM Usage
Recent data from the RBI indicates a decline in cash withdrawals, with transactions dropping from over 57 crore in January 2023 to 52.72 crore in January 2024, and further to 48.83 crore by January 2025. Despite this downward trend, cash remains a crucial part of India’s economy. The average monthly ATM withdrawals for the fiscal year 2024 stood at Rs 1.43 crore, reflecting a 5.51 percent year-on-year growth. The updated fee structure is part of a broader strategy to enhance ATM infrastructure while ensuring that customers are informed about the costs associated with their transactions.
Observer Voice is the one stop site for National, International news, Sports, Editor’s Choice, Art/culture contents, Quotes and much more. We also cover historical contents. Historical contents includes World History, Indian History, and what happened today. The website also covers Entertainment across the India and World.
Follow Us on Twitter, Instagram, Facebook, & LinkedIn
