ATM Withdrawals to Become More Expensive as Transaction Fees Increase from May 1

The Reserve Bank of India (RBI) has approved an increase in transaction fees effective May 1, 2025 for ATM withdrawals which will affect bank customers across the country. This decision will directly impact customers who frequently use ATMs and specially those who use ATMs of banks other than their own. 

Transaction Fee Hike Details

According to recent reports, the RBI has approved a proposal from the National Payments Corporation of India (NPCI) to increase ATM transaction fees. Currently, customers using other banks' ATMs are charged Rs 17 per transaction, but from May 1, this fee will increase to Rs 19 per transaction.

Similarly, banks currently charge Rs 21 for transactions exceeding the free transaction limit. After the new rates take effect, this charge will increase to Rs 23 per transaction. 

Impact on Customers

This fee increase will primarily affect customers who regularly withdraw cash from the ATM and frequently use ATM of other banks and exceed their monthly free transaction limits.

Here's How You Can Minimize Extra Charges

Financial experts suggest several ways for customers to avoid these additional charges:

1. Understand your bank's free transaction limit and maintain your transaction in limit
2. Use your own bank's ATMs whenever possible as ATM of other banks have more transaction fee
3. Increase the use of digital payment methods to reduce the need for cash withdrawals
4. Plan larger withdrawals less frequently instead of multiple smaller withdrawals 

The fee is increased as banks wants customer to shift to digital payment system instead of transactions in hard cash .