ATM cash withdrawal beyond permissible limit gets costlier by Re 1

Bank customers are now required to pay one rupee more on each ATM transaction done beyond the permissible limit of free transactions.

Effective from January 1, 2022 banks are permitted to charge Rs 21 per transaction if a customer exceeds the permissible free limits, instead of the earlier rate of Rs 20 per transaction.

The charges on ATM transactions have been increased following a notification of the Reserve Bank of India (RBI) dated June 10, 2021.

"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. This increase shall be effective from January 1, 2022," RBI had said in its notification.

Customers are eligible for five free transactions (inclusive of financial and non-financial transactions) every month from their own bank ATMs.

They are also eligible for free transactions (inclusive of financial and non-financial transactions) from other bank ATMs viz. three transactions in metro centres and five transactions in non-metro centres.

The last change in interchange fee structure for ATM transactions was in August 2012, while the charges payable by customers were last revised in August 2014.

The RBI has notified the changes from January 1, 2022, citing the increasing cost of ATM deployment and expenses towards ATM maintenance incurred by banks or white-label ATM operators.

Ashwani Rana, Founder of, Voice of Banking said, "The increase of service charges per ATM transaction will be charged from the customers beyond a number of transactions permitted by the respective banks. This increase is only Rs 1 plus Goods and Services Tax (GST), which is very nominal to customers against the maintenance charges paid by banks as earlier they were charging Rs 20."

Nipun Jain, Chief Executive Officer, RapiPay Fintech clarified, "Consumers withdrawing cash using our Micro ATMs and Aadhaar Enabled Payment System (AEPS) will not be affected with the recent RBI guideline to increase ATM transactions charges (applicable after the customers exhaust the free monthly limit)."

"We believe this will boost the already growing demand for cash withdrawal through AEPS and Micro ATMs at our direct business outlets and help us in achieving our goal of growing financial inclusion in deeper geographies and far-flung areas like North East, Kashmir, Ladakh, and Uttrakhand. We have sold over one lakh Micro ATMs since we began operations last year. Our average ticket size of withdrawal has climbed from Rs 3500 to Rs 3800, with a CAGR growth of 25 per cent in Micro ATMs in the last one year," Jain added.

( With inputs from ANI )

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