ATM Transaction Fee Changes Effective May 1, 2025
As of May 1, 2025, customers using ATMs beyond their allotted free transactions will now incur higher fees. India’s central banking authority introduced these revisions following operational cost evaluations and feedback from stakeholders in the financial ecosystem. The revised structure is designed to reflect the ongoing investments required to sustain and secure ATM infrastructure across the country.
Revised ATM Transaction Charges
According to the new policy:
- ATM transactions beyond the monthly free limit will now cost Rs 23 each. Previously, customers paid Rs 21 for such transactions, making this a marginal increase of Rs 2 per transaction.
- The revised rate applies to both financial and non-financial transactions.
- This includes all types of ATMs—whether managed by your own bank or another.
This change is aimed at balancing the growing cost burden of ATM infrastructure while promoting the adoption of digital payments.
Free ATM Transaction Limits Remain the Same
RBI has retained the number of free monthly ATM transactions allowed for savings account holders:
- 5 complimentary ATM transactions at your own bank’s ATMs each month
- 3 no-cost ATM transactions at other-bank ATMs in metro cities
- Up to 5 free transactions at ATMs of other banks in smaller cities and rural areas
These no-charge transactions cover both cash withdrawals and non-financial activities such as viewing balances or getting a mini-statement.
Why the Increase?
Several factors led to the decision to hike ATM usage fees:
- Rising operating expenses: Costs for power, security, equipment upkeep, and cash logistics have all increased.
- Upgrading technology: Banks are investing in more secure and efficient ATM systems.
- Dependence on shared infrastructure: Smaller banks and third-party ATM providers (like white-label ATMs) rely on other banks’ infrastructure, raising service delivery costs.
The updated charges help banks and service providers manage these expenses more effectively.
Who Is Likely to Be Affected?
While many customers may not see a change if they stay within their free limits, some groups are likely to be affected:
- High-frequency ATM users who often exceed monthly limits
- Rural and semi-urban customers with lower access to digital payments
- Customers of banks with limited ATM reach, who often rely on other banks’ machines
Planning withdrawals and using digital payment methods can help reduce extra costs.
Tips to Avoid Extra ATM Charges
Here are some practical ways to manage ATM usage and avoid additional fees:
- Use UPI, mobile banking apps, or net banking for daily transactions.
- Consider withdrawing larger sums less frequently instead of multiple small transactions.
- Track the number of ATM transactions you’ve used via your bank’s mobile or online banking services.
Summary at a Glance
- Rs 23 per ATM transaction after exhausting free limits (earlier Rs 21)
- Free transaction limits remain unchanged
- Fee revision applies to both financial and non-financial transactions
- Higher charges help cover maintenance, security, and operational expenses
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Frequently Asked Questions (FAQs)
Q1. Why were ATM fees raised in 2025?
To cover growing costs of maintaining ATM infrastructure and delivering secure services across the banking system.
Q2. How many ATM transactions are free each month?
Account holders get 5 free transactions at their own bank’s ATMs, and 3 in metro areas or 5 in non-metro regions at other banks’ ATMs.
Q3. What happens if I exceed the free transaction limit?
Each transaction beyond the free limit will incur a charge of Rs 23, regardless of whether it is a withdrawal or a service request.
Q4. Does this apply to all types of accounts?
This policy generally affects regular savings accounts. Premium accounts may offer different terms.
Q5. What can I do to avoid ATM fees?
Use digital platforms for payments and check your bank’s app to monitor usage and avoid crossing the limit.
