ATM transaction revised rules come into effect from May 1; Check here for new charges

As per the new guidelines, customers are now eligible for five free transactions every month from their respective banks. They will be charged if the limit exceeds

Hyderabad: As directed by the Reserve Bank of India (RBI), banks from today ie, May 1, will apply a revised fee structure for ATM transactions. The new guidelines imposed by the apex bank emphasise free ATM transaction limits, revising charges for exceeding limits, and modifying the structure of interchange fees.

As per the new guidelines, customers are now eligible for five free transactions every month from their respective banks. They can also avail of three free ATM transactions in metro cities and five transactions in non-metro cities from other banks. Customers will be charged if the limit exceeds. The transactions include both financial and non-financial dealings.

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The RBI notification, dated March 28, 2025, says, “The ATM interchange fee will be as decided by the ATM network. Beyond the free transactions, a customer may be charged a maximum fee of Rs 23 per transaction. This shall be effective from May 1, 2025. Applicable taxes, if any, shall be additionally payable. These instructions shall also apply, mutatis mutandis, to transactions done at Cash Recycler Machines (other than for cash deposit transactions).”

Starting today if your ATM transactions cross the limit your bank will charge you Rs 23 for each activity. This rate applies for every move whether you are withdrawing money or just checking your balance.

Several banks have already notified their customers about the revised transaction fee. Banks like IndusInd, PNB, and HDFC have sent notifications to their customers saying, “With effect from 1st May 2025, ATM transaction charge rate beyond the free limit of Rs. 21 + taxes would be revised to Rs 23 + taxes, wherever applicable.”

PNB’s notification says, “It is to inform that the customer charges for over and above free transactions on other Banks’ ATMs are revised as Rs.23/- per financial transaction and Rs. 11/- per non-financial transaction (excluding GST) w.e.f. 09.05.2025.”

According to IndusInd, “All the Savings/Salary/NR/Current Account customers will be charged INR 23 per transaction for ATM Cash withdrawal made at Non-IndusInd Bank ATMs, beyond free limits, effective 1st May 2025.”

But why do banks charge for ATM transactions?
Banks charge ATM interchange fees for providing services to customers. Often, banks pay each other for offering ATM services to other bank customers. This time the RBI has allowed banks to increase charges to cover rising costs.