RBI’s new ATM transaction rules take effect from May 1: Charges, revised limits – all you need to know
Starting May 1, 2025, the Reserve Bank of India‘s (RBI) updated framework for ATM transaction charges will come into force, bringing changes to free transaction limits, charges for additional transactions, and interchange fee structures across the country.
Under the new guidelines, customers will be entitled to a set number of free ATM transactions each month—three in metropolitan areas and five in non-metropolitan regions. These free transactions include both financial and non-financial activities.
Once customers exceed their monthly free transaction limits, banks will be allowed to charge up to Rs 23 per transaction, with applicable taxes added. These charges apply to both financial and non-financial transactions and extend to usage at Cash Recycler Machines (CRMs), excluding cash deposits.
Several major banks, including HDFC Bank, Punjab National Bank (PNB), and Kotak Mahindra Bank, have already begun notifying customers of the changes.
According to HDFC Bank, “With effect from 1st May 2025, the ATM transaction charge rate beyond free limits will be revised from Rs 21 + taxes to Rs 23 + taxes, wherever applicable.” The bank clarified that at HDFC Bank ATMs, only cash withdrawals beyond the free limit will incur charges, while non-financial transactions remain free. However, at other banks’ ATMs, both financial and non-financial transactions will be counted toward the free transaction limit.
PNB also announced revisions, stating, “Customer charges for transactions over and above free limits at other banks’ ATMs are revised to Rs 23 per financial transaction and Rs 11 per non-financial transaction (excluding GST) with effect from 9th May 2025.”
IndusInd Bank, too, has updated its policy: “All Savings, Salary, NRI, and Current Account customers will be charged Rs 23 per transaction for ATM cash withdrawals at non-IndusInd Bank ATMs beyond free limits, effective 1st May 2025.”
As these changes take effect, customers are advised to:
- Monitor their ATM usage, especially at other banks’ ATMs in metropolitan areas
- Be aware of the Rs 23 cap on charges for transactions beyond the free limit
- Remember that these charges also apply at CRMs, except for cash deposits
Also read: India committed to reforms, says RBI governor
The RBI’s move aims to streamline ATM usage charges while encouraging the adoption of digital banking alternatives.
Reserve Bank of India data revealed cash withdrawals decreased from over 57 crore transactions in January 2023 to 52.72 crore in January 2024, with a further reduction to 48.83 crore by January 2025. Despite this trend, cash continues to play a vital role in India’s economy. The 2021 fee adjustment supported ATM infrastructure expansion.
The average monthly ATM withdrawals in FY24 stood at Rs 1.43 crore, reflecting a 5.51 per cent yearly growth. NPCI communications detailed a Rs 7 interchange fee for balance enquiries in Nepal and Bhutan, exclusive of GST, whilst retaining current cash withdrawal rates. These updated charges exclude Micro-ATMs, interoperable cash deposits, and international ATM operations.
