ATM service charges rise to Rs 21 per transaction from today

New Delhi: Customers using Automated Teller Machines (ATMs) across banks will now incur higher service charges, with fees raised to Rs 21 per transaction beyond the free monthly limit, as per the Reserve Bank of India's (RBI) directive. This change, effective from January 1, 2022, represents a Rs 1 increase from the previous charge of Rs 20, plus applicable taxes. The RBI issued this update to help banks manage the rising expenses of ATM installation and upkeep.

Under current guidelines, bank customers are entitled to five free ATM transactions each month at their own bank’s ATMs, covering both financial and non-financial transactions. They also receive free access to other banks' ATMs, up to three times per month in metro areas and five times in non-metro regions. The previous revision to ATM service charges for customers was in August 2014, while the interchange fee structure was last modified in August 2012.

Ashwani Rana, founder of Voice of Banking, explained that the nominal Rs 1 increase, in addition to GST, helps cover the escalating maintenance costs for ATMs, with charges applying only after customers exceed their allowed free transactions. Nipun Jain, CEO of RapiPay Fintech, further clarified that customers using RapiPay’s Micro ATMs or the Aadhaar Enabled Payment System (AEPS) are unaffected by this change, even if they go over their free transaction limit.

Jain noted that the adjustment may encourage more users to opt for AEPS and Micro ATM services, especially in remote areas like the North East, Kashmir, Ladakh, and Uttarakhand, where access to banking facilities is often limited. Since last year, RapiPay has deployed over one lakh Micro ATMs, observing a 25 percent compound annual growth rate in transactions, with average withdrawal amounts rising from Rs 3,500 to Rs 3,800.

With ANI inputs