Things you need to know about new ATM cash withdrawal rules
The year 2022 has ushered in a slew of
additional charges and rules that will have a direct influence on your cash
flow. The Reserve Bank of India (RBI) announced that ATM cash withdrawal fees have
been increased from January 1, 2022. Lenders such as ICICI Bank, HDFC Bank, and
Axis Bank have updated their websites to reflect the increased charges for cash
and non-cash ATM transactions that exceed the free monthly transaction limit. Once
the free monthly limit is reached, bank customers will have to pay extra for
ATM transactions with effect from January 1, 2022.
How
much should you pay for an additional ATM cash withdrawal?
The Reserve Bank of India has already
announced that, with effect from January 1, 2022, bank customers who exceed
their monthly limit of free ATM transactions will be charged Rs 21 instead of
Rs 20 (Which was charged previously) for each transaction.
Home bank customers, should be aware that
they are entitled to five free transactions (including financial and
non-financial transactions) every month from home bank ATMs.
On the other hand, customers can perform
three free transactions in metro cities and five free transactions in non-metro
centers from other banks each month, according to RBI guidelines. Financial and
non-financial transactions are included in these free transactions.
Why
did the RBI raise ATM withdrawal service charges?
It's worth noting that the RBI announced
the changes in June 2019 after consulting with a committee formed by the
central bank. The recommendations were made after the group examined the full
range of ATM charges and fees, with a special focus on the interchange
mechanism for ATM transactions.
Cash Recycler Machines are also covered by
the new rule. The RBI had revised the transaction limit in August 2021.