RBI increases ATM charges: Know what changes from May 1

The Reserve Bank of India (RBI) has decided to increase ATM withdrawal charges, effective from May 1. This fee hike is part of a revision in interchange charges, which are the fees banks pay each other for ATM transactions. With the new rates, banks may pass on the increased costs to their customers.

Why Are ATM Charges Increasing?

The RBI revised the fees to help banks cover the operational expenses of maintaining ATMs. These expenses include security, electricity, cash management, and machine upkeep. By adjusting the charges, the RBI aims to ensure banks can continue offering ATM services efficiently.

Free ATM Transactions and Extra Charges

Currently, customers can make a limited number of free ATM withdrawals each month from their own bank’s ATMs. They are also allowed a few free transactions at other banks’ ATMs. Once the free limit is crossed, banks charge a fee for additional withdrawals. From May 1, these fees will likely be higher.

How to Stay Informed

Banks are expected to announce the updated charges soon. Customers can check their bank’s website, mobile app, or visit branches for detailed information. The RBI has also instructed banks to inform their customers about the revised fees transparently.

Alternatives to ATM Withdrawals

To avoid additional charges, customers are encouraged to consider digital payment options. UPI, mobile wallets, and internet banking offer convenient, secure, and cost-effective alternatives to cash. Using these digital methods for routine expenses can reduce the need for frequent ATM visits.

Plan Your Withdrawals Wisely

Financial experts suggest planning cash withdrawals carefully to stay within the free transaction limit. Maintaining a budget and using digital payments whenever possible can help minimize extra fees.