ATM charges hiked to ₹23 after free limit from May 1

Beginning May 1, using ATMs beyond the permitted free transactions will cost customers more, as banks raise the fee per transaction from ₹21 to ₹23.

This increase applies after individuals exceed their monthly quota of free ATM transactions—five from their own bank and either three or five from other banks, depending on whether they are in metro or non-metro areas.

The Reserve Bank of India (RBI) has also permitted ATM networks to determine the interchange fee, which is the amount one bank pays another for allowing its customers to use their ATMs.

Earlier in the year, the RBI reviewed both customer charges and the interchange fee for ATMs and cash recycler machines.

“Beyond the free transactions, a customer may be charged a maximum fee of ₹23 per transaction. This shall be effective from May 1, 2025,” the RBI noted in an official notification, adding that applicable taxes would be charged separately.

This marks the first increase since January 2022, when the fee was raised from ₹20 to ₹21, following rising costs and a hike in interchange fees. The ₹20 cap was originally implemented by the RBI in 2014.

In August 2021, the RBI had approved a rise in the interchange fee to ₹17 for financial transactions and ₹6 for non-financial ones.

India’s ATM network—vital to its banking ecosystem—is largely operated through the National Financial Switch (NFS), managed by the National Payments Corporation of India (NPCI).

ATMs are linked to banks’ core systems through internal switches and connected to other banks via apex-level switches, enabling cross-bank ATM use.

This interlinked system allows cardholders to withdraw cash or check balances at ATMs outside their bank’s network.

The ATM-owning bank charges a fee to the card-issuing bank, known as the interchange fee.

These fees vary based on agreements between banks and are a significant revenue stream for banks with larger ATM networks.

As of March 2025, India had approximately 2.55 lakh ATMs, comprising 2.19 lakh bank-owned units and 36,216 white-label ATMs.

Public sector banks accounted for 133,000 of these, with private and foreign banks operating 77,117 and 993, respectively.