ATM cash withdrawal charges to rise from tomorrow: Key things to know

Bank customers will have to pay more for their ATM transactions from January 1 i.e. tomorrow once the free monthly limit gets exhausted. Lenders like ICICI Bank, HDFC Bank and Axis Bank have updated their website regarding these increased charges.

The Reserve Bank of India (RBI) has permitted banks to increase charges for cash and non-cash ATM transactions beyond the free monthly permissible limit.

According to the RBI notification, customers will have to pay Rs 1 more than what they were paying earlier to withdraw money. As a result, cash withdrawal fee through debit card or credit card of any public or private sector bank will now cost Rs 21 per transaction from the existing Rs 20.

Over and above this amount, there is also a tax under the goods and services tax (GST) regime.

The hiked charges will be applicable once the free monthly limit gets exhausted. This will come into effect from the new year.

The customers will, however, be allowed five free transactions, including financial and non-financial ones on a monthly basis from their own bank ATMs and they will be able to conduct three free transactions from ATMs of other banks in metro cities and five in case of non-metro cities.

Banks would be able to levy charges on customers within this ceiling, once they exhaust the free transaction limit.

To compensate the banks for the higher interchange fee and given the general escalation in costs, they are allowed to increase the customer charges to Rs 21 per transaction, RBI had said in a statement.

These revisions in charges have been done after a comprehensive revision of the recommendations of the committee.