New Delhi: Withdrawing cash from ATMs across India has become more expensive from May 1 following the Reserve Bank of India’s (RBI) approval of a hike in interchange fees.
According to the RBI’s revised guidelines, customers will now be charged Rs 23 per cash withdrawal after exhausting their free monthly transaction limit, up from the previous Rs 21. Non-financial transactions, such as balance inquiries, will cost Rs 7 per transaction, a Rs 1 increase from the earlier Rs 6.
Similarly, the interchange fee for cash withdrawals has also risen from Rs 17 to Rs 19 per transaction.
“The increase in ATM charges is expected to support banks in maintaining a wide ATM network and offering better, safer services to customers,” the RBI stated in a circular.
The existing free transaction limits includes five free transactions per month at a customer’s own bank ATMs, three free transactions at other banks’ ATMs in metro cities, and five in non-metro areas. Once these limits are exceeded, the new charges apply.
It applies across all commercial banks, including regional rural banks, co-operative banks, authorised ATM network operators, and white-label ATM service providers.
Banking experts suggest that the hike may push more customers toward cashless transactions. There has been a decline in ATM usage with cash withdrawals dropping from 57 crore transactions in January 2023 to 48.83 crore in January 2025, reflecting a growing preference for digital payments like UPI.
