ATM Cash Withdrawals Charges To Increase from 1st May after RBI's Nod
Moneylife Digital Team 31 March 2025
The Reserve Bank of India (RBI) allowed banks to increase cash withdrawals charges at automated teller machines (ATMs) by Rs2 to Rs23 per transaction from 1 May 2025. These chrarges will apply for transactions beyond free transactions permitted by banks, RBI says.
 
In a circular, RBI says, "Beyond the free transactions, a customer may be charged a maximum fee of Rs23 per transaction. This shall be effective from 1 May 2025."
 
Bank customers are allowed five free transactions every month from their own bank ATMs. They can also allowed three transactions in metro centres and five in non-metro centres on other bank ATMs. These free transactions on the bank's own ATMs and other bank ATMs, include financial and non- financial transactions. 
 
According to RBI, the increase in charges will also apply to transactions done at cash recycler machines other than for cash deposit transactions. 
 
As reported by Moneylife, the Indian government has disclosed that, while the State Bank of India (SBI) is earning significant fee income from ATM cash withdrawals, other public sector banks (PSBs) are struggling with financial losses in this domain. During the past five years, SBI earned an income of Rs2,043 crore from cash withdrawals at ATMs, while nine PSBs suffered a loss of Rs3,738.78 crore. On a cumulative basis, Punjab National Bank (PNB) and Canara Bank are the only other two PSBs that have earned a profit of Rs90.33 crore and Rs31.42 crore from ATM cash withdrawals, according to a written reply in the Lok Sabha. 
 
According to the government's reply, SBI has consistently earned higher fee income from ATM transactions over the past five years, while other PSBs have suffered losses. 
 
The response revealed that SBI, India's largest PSB, has successfully turned ATM cash transactions into a significant source of fee income, mainly due to its extensive network and structured fee policies. In contrast, other PSBs have been incurring losses, unable to balance operational costs against declining transaction volumes and fee structures.
 
Data shared by RBI shows that as of January 2025, PSBs have 135,908 ATMs installed across the country. As expected, SBI has the highest number of ATMs at 64,993 installed. It is followed by PNB at 12,974 ATMs and Canara Bank at 11,968 ATMs. (Read: SBI Earned Rs2,043 Crore from ATM Cash Withdrawals in 5 Years while Other Public Sector Banks Lost Rs3,739 Crore: Govt)
Comments
vs.iyer316
3 weeks ago
A very good move. Government should now discontinue Rs. 500/- currency too. Cash dealing should slowly stop now.
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