RBI’s New ATM Rules Effective May 1, 2025: Charges, Free Limits, and What Customers Must Know
New ATM Rules- Starting May 1, 2025, the Reserve Bank of India (RBI) is rolling out new guidelines for ATM transactions across the country. These changes will impact the number of free ATM transactions allowed per month, the charges for additional usage, and the structure of interchange fees.
Revised Free Transaction Limits
As per the updated framework, bank customers will now be allowed a limited number of free ATM transactions every month:
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Metropolitan cities: Up to 3 free ATM transactions
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Non-metropolitan regions: Up to 5 free ATM transactions
These limits include both financial transactions (like cash withdrawals) and non-financial ones (such as balance checks or mini statements).
Charges After Free Transactions
New ATM Rules- Once a customer exceeds their monthly free transaction quota, banks are permitted to charge up to Rs 23 per transaction, plus applicable GST. This applies to both financial and non-financial activities, and includes transactions made at Cash Recycler Machines (CRMs)—except for cash deposits, which remain free.
How Major Banks Are Responding
Several leading banks have already updated their customers about the changes:
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HDFC Bank stated that from May 1, 2025, ATM transaction charges will increase from Rs 21 to Rs 23 (plus taxes) beyond the free limit. At HDFC Bank ATMs, only cash withdrawals beyond the limit will be charged. However, at other banks’ ATMs, both financial and non-financial transactions will count toward the free limit.
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Punjab National Bank (PNB) announced that, starting May 9, 2025, customers using other banks’ ATMs will be charged Rs 23 per financial transaction and Rs 11 per non-financial transaction, excluding GST.
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IndusInd Bank has updated its policy for all Savings, Salary, NRI, and Current Account holders, stating that ATM cash withdrawals at non-IndusInd Bank ATMs beyond the free limit will cost Rs 23 per transaction, effective May 1, 2025.
What Customers Should Keep in Mind
With these changes coming into effect, here’s what you should do:
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Track your monthly ATM usage, especially if you often withdraw cash from other banks’ ATMs in metro areas.
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Be aware of the Rs 23 cap per extra transaction, and note that taxes apply on top of this amount.
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CRMs now fall under the same charge policy as ATMs, excluding deposits which remain free.
Why the Change?
The RBI’s move aims to create a more consistent and fair fee structure across banks, while also encouraging customers to explore digital banking alternatives. Despite the shift toward online and mobile banking, cash continues to play a critical role in India’s economy.
According to RBI data, monthly ATM cash withdrawals have been gradually declining—from over 57 crore in January 2023 to 48.83 crore in January 2025. Still, ATM usage remains a key part of everyday banking, especially in semi-urban and rural areas.
In FY24, the average monthly ATM withdrawal value stood at Rs 1.43 crore, showing a 5.51% year-on-year increase. Meanwhile, the National Payments Corporation of India (NPCI) also confirmed a Rs 7 interchange fee for balance enquiries in Nepal and Bhutan, excluding GST. These updates do not affect Micro-ATMs, international ATM operations, or interoperable cash deposit machines.
Final Thoughts
As banks revise their ATM policies, it’s important for customers to stay informed, limit unnecessary ATM visits, and explore digital options for everyday banking. The new guidelines seek to balance customer convenience with operational efficiency and infrastructure development.
