ATM transaction limit: ATM transaction charges by banks in India

With the advent of ATMs, it has become really easy to withdraw or deposit cash. Long gone are the days of standing in serpentine queues.

ATM transactions attract charges. A cardholder is also liable to pay other charges for holding a debit card. Let’s understand the ATM transaction charges in greater details.

 

Know about New ATM Transaction Charges

In August 2014, the Reserve Bank of India rolled out a new policy in which it revised the number of free ATM transactions offered by banks. The new policy provided that banks have to provide a certain number of free-of-cost ATM transactions per month to their customers.

Under the revised policy, a customer is allowed eight free ATM transactions in a month. Of these, five are at the ATM of the bank which has issued the card. Three free transactions are permitted when the debit card is used at the ATM of other banks. The free transactions include both financial (cash payment and withdrawal) and non-financial transactions (balance enquiry, mini statement, changing ATM PIN, booking a fixed deposit etc.)

Once the customer surpasses the ATM transaction limit, he is charged a nominal fee per transaction. Banks charge ₹ 20 for financial transactions and ₹8.5 for non financial transactions. These are the maximum amounts that can be charged by a bank.

Charges are also levied for ATM transactions for PIN regeneration.

In June 2019, Reserve Bank of India announced in its monetary policy that a committee involving all stakeholders, under the chairmanship of the Chief Executive Officer, Indian Banks' Association (IBA), to examine the entire gamut of ATM charges and fees.  It is expected that when this report is submitted, RBI will issue guidelines to further streamline the process of charges applicable for ATM transactions.

 

Revised charges for ATM transactions

Most banks in India allow certain free-of-cost ATM transactions. Once you exceed the ATM transaction limit, charges are applicable. The table below sets out the charges applicable:
 

In addition to the above, debit cards also attract other charges from the issuing bank. Here is a breakup of the charges imposed by major banks in India.

State Bank of India:

Other than these charges, the bank also levies domestic transaction charges. They are charged as under:

-Other Bank ATMs - SBI debit card holders with savings accounts get up to 5 free transactions within a calendar month

-Beyond the ATM transaction limit, you are charged ₹17/- for financial transactions such as cash deposit or withdrawal and ₹6/- for non-financial transactions such as applying for cheque book, checking account balance and mini statements. Both the charges are inclusive of applicable GST.

HDFC Bank:

HDFC bank permits four free cash withdrawals per month and provides five free transactions at non HDFC Bank ATMs across the country. Any withdrawals beyond the ATM transaction limit attracts a charge of ₹20/- plus applicable GST in case of a financial transaction. In case of a non-financial transaction, you need to pay ₹8.5 plus applicable GST.

ICICI Bank:

 

Axis Bank:

How to Avoid ATM Transaction Charges

Charges for any transaction beyond the ATM transaction limit are inevitable. Banks keep revising the number of free transactions offered for using other bank ATMs and its own ATM. If you exceed the permitted transactions at other banks, you have to bear some additional charges. Here’s what you can do to avoid these charges:

Go cashless: Most establishments accept debit cards. You can pay for goods or services by simply swiping your debit card. This reduces the need to withdraw cash. You can also avoid paying ATM transaction charges from other banks for transactions beyond permissible limits. You can also opt to pay for your online purchases by using your debit or credit cards instead of opting for cash on delivery.

Opt for online bill payments: Debit cards can be used to pay utility bills. When you pay your bills online, you can do the same with your debit card. This eliminates any need for cash withdrawal.

Opt for mobile banking: Save all your free transactions for emergency cash withdrawals. For any information about your account and available balance etc., don’t use an ATM. This is also counted as a transaction. Instead use the mobile banking app or net banking services. Remember to not waste free transactions on non-financial transactions.

 

FAQs

What is an On-Us and Off-Us transaction?

A transaction carried out at an ATM of the card issuing bank is called as On-Us transaction. A transaction carried at an ATM of the bank which is different from the card issuing bank is called an Off-Us transaction. For instance, if a card issued by bank A is used at an ATM of bank A then it is an On-Us transaction; if the card issued by bank A is used at an ATM of bank B, it is an Off-Us transaction. In case of an Off-Us transaction, the ATM transaction charges from other banks is levied.

Are customers entitled to any free transactions at ATMs?

With effect from November 01, 2014, a bank must offer to its savings bank account holders a minimum number of free transactions at ATMs as under:

-Transactions at a bank’s own ATMs (On-Us transactions) at any location: 

Banks must offer their savings bank account holders a minimum of five free transactions (including both financial and non-financial) in a month, irrespective of the location of ATMs.

-Transactions at any other banks’ ATMs (Off-Us transactions) at Metro locations: In case of ATMs located in six metro locations, viz. Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad, banks must offer their savings bank account holders a minimum of three free transactions (including both financial and non-financial transactions) in a month.

-Transactions at any other banks’ ATMs (Off-Us transactions) at Non-Metro locations: At any location, other than the six metro locations as above, banks must offer the savings bank account holders a minimum of five free transactions (including both financial and non-financial transactions) in a month at other bank ATMs.

Is a bank allowed to offer more number of free transactions at ATMs?

The mandated minimum number of free transactions at ATMs has been stipulated by RBI. Banks may offer more number of transactions free of cost to their customers.

Is there any way to avoid ATM transaction charges from other banks?

Try to keep your withdrawals within the free-of- transactions allowed. Swipe debit card at merchant establishments and pay utility bills instead of cash payments.