ATM Withdrawals to Cost More from May 1 – Starting May 1, 2025, your regular ATM visits could take a slightly bigger bite out of your wallet. The Reserve Bank of India (RBI) has approved an increase in interchange fees, meaning banks will now charge customers more for using ATMs beyond their free monthly limits.
Whether you’re withdrawing cash, checking your balance, or printing a mini statement, these changes will affect millions of Indian bank customers. In this article, we break down the new charges, explain how the free limits work, and provide actionable advice to avoid unnecessary fees.
ATM Withdrawals to Cost More from May 1
| Topic | Details |
|---|---|
| New Cash Withdrawal Fee | ₹19 per transaction (up from ₹17) after free limit |
| New Non-Financial Transaction Fee | ₹7 per transaction (up from ₹6) after free limit |
| Free ATM Limits (Metro) | 5 free transactions/month at other banks’ ATMs |
| Free ATM Limits (Non-Metro) | 3 free transactions/month at other banks’ ATMs |
| Effective Date | May 1, 2025 |
| Official Regulator | Reserve Bank of India – rbi.org.in |
| Digital Payment Tip | Use UPI, net banking, or mobile wallets to reduce ATM usage |
| Who’s Most Affected | Users in rural areas, senior citizens, customers of smaller banks |
From May 1, 2025, ATM charges are set to increase — but you don’t have to get caught off guard. With simple awareness and digital habits, you can avoid or reduce these extra fees. Stick to your own bank’s ATMs, switch to UPI or mobile wallets, and track your usage smartly.
The updated ATM fees may seem small, but over time they can add up, especially for frequent users. Understanding these changes now will help you make better financial choices going forward — and that’s always a win.
Why Are ATM Charges Increasing in 2025?
The new charges come after the RBI approved a revision in interchange fees, which are the charges paid between banks when you use an ATM that isn’t operated by your own bank.
As per the National Payments Corporation of India (NPCI), the cost of running ATM infrastructure has gone up significantly — from power, rent, and cash logistics to cyber-security. So, banks are adjusting the fees to reflect these expenses.
India had over 64 crore ATM transactions monthly in 2024, according to RBI data. Even though digital payments are on the rise, cash remains essential in many regions.
What Are the New ATM Charges From May 1?
Here’s a quick look at what you’ll pay if you exceed your monthly free transaction limits:
| Type of Transaction | Old Fee | New Fee (from May 1) |
|---|---|---|
| Cash Withdrawal (Other Banks) | ₹17 | ₹19 |
| Non-Financial (Balance Check) | ₹6 | ₹7 |
GST will also be applicable, so the final cost per transaction may be slightly higher than ₹19 or ₹7.
Free Monthly ATM Limits Explained
For Metro Cities (Delhi, Mumbai, Bengaluru, etc.)
- 5 free transactions/month at other bank ATMs
- Unlimited free usage at your own bank’s ATMs
For Non-Metro Locations
- 3 free transactions/month at other bank ATMs
- Unlimited free transactions at own bank ATMs
This includes both financial and non-financial transactions. Once you cross these limits, the new charges apply.
Who Will Be Most Affected?
The fee hike will be felt most by:
Senior Citizens
Many retirees still rely on cash and may visit ATMs frequently, especially if they lack smartphones or digital payment access.
Rural Users
Tier-2 and Tier-3 cities and villages, where digital infrastructure is weak, still rely heavily on ATMs. Smaller banks with fewer ATMs may see customers pay more due to using other banks’ machines.
Customers of Small or Regional Banks
Smaller banks usually don’t have large ATM networks, pushing customers to use other banks’ ATMs, which now cost more after the free limit.
Digital Alternatives to Avoid ATM Charges
ATM fees are rising — but you don’t have to pay them if you adapt to modern, digital payment methods.
Unified Payments Interface (UPI)
Apps like PhonePe, Google Pay, and BHIM allow instant money transfers, bill payments, and merchant transactions with zero fees.
Internet & Mobile Banking
Transfer funds, check balances, or order chequebooks from your home. Most banks have apps and secure portals.
Point-of-Sale Payments
Use your debit card to make purchases at shops and supermarkets. There’s no charge, and you avoid cash handling.
Mobile Wallets
Apps like Paytm and Amazon Pay are ideal for topping up services, paying bills, or booking tickets.
Regulatory Background: Who Decides ATM Fees?
The RBI regulates ATM fees through guidelines issued under the Payment and Settlement Systems Act. Interchange fees are reviewed periodically based on industry recommendations.
In its 2021 circular, the RBI last increased ATM cash withdrawal fees, and 2025 marks the next revision, primarily due to higher maintenance costs and inflation.
Official guideline link: RBI ATM Fee Circular
What the Industry Is Saying?
According to Arundhati Bhattacharya, former Chairperson of SBI: “Fee adjustments are inevitable. ATM networks are expensive to run, and unless balanced, their availability could suffer.”
Meanwhile, fintech experts argue that the change nudges people toward digital financial inclusion, aligning with India’s Digital India goals.
A PwC India report noted that “as of 2024, digital transactions grew 33% year-on-year, but ATMs remain relevant for cash-driven regions and low-income users.”
Will ATM Charges Rise Again?
Possibly. If ATM usage continues to decline while operational costs rise, banks may request further revisions. However, the RBI keeps a tight watch on consumer affordability and financial inclusion, so any increases will likely be gradual.
Experts believe ATM use in India will remain stable for the next five years, but will steadily reduce as UPI Lite, offline QR codes, and voice-based banking expand.
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FAQs
Do I have to pay even for checking my balance at the ATM?
Only if you exceed the monthly limit. Otherwise, balance checks are free up to 3 or 5 times, depending on your city.
Will I be charged for using my own bank’s ATM?
No, most banks allow unlimited free transactions at their own ATMs.
What happens if I withdraw from an ATM abroad?
International ATM charges are separate, often ₹100–₹200 per transaction. Check with your bank.
Can I opt for SMS alerts instead of checking balance at ATMs?
Yes. SMS banking or mobile app notifications are free and more efficient.
How can I check how many free transactions I’ve used?
Use your bank’s mobile app, net banking, or contact customer support.
