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Axis Bank hikes cash withdrawal and SMS charges: All that you need to know

The bank is increasing charges for non-maintenance of minimum balance, cash withdrawal and SMS alerts

April 23, 2021 / 11:49 AM IST

Axis Bank has hiked charges for its savings bank account holders. If you are a customer, here’s what you need to know.

Non-maintenance of minimum balance

Cases of non-maintenance of monthly minimum balance charges have increased. From May 1, you need to maintain Rs 15000 as average monthly balance, up from Rs 10,000 at present. Similarly, for the Prime and Liberty branded savings accounts, the average monthly balance threshold is Rs 25,000, up from Rs 15,000 earlier.

Any failure in maintaining these limits would attract a penalty of Rs 10 per Rs 100 of the shortfall. However, the bank has reduced the minimum charges under this head to Rs 50, down from Rs 150 before. But it has increased the maximum charges to Rs 800 from the existing sum of Rs 600.


For instance, effective from May 1, if your average monthly balance is between Rs 5,000 and Rs 7,500, the bank will charge Rs 800 plus taxes.

The revised charges of Axis Bank are now higher compared to what HDFC Bank and Kotak Mahindra Bank levy. The maximum charge for non-maintenance of minimum balance is Rs 600 at HDFC Bank and Kotak Mahindra Bank (for pro and ace) savings accounts. The average monthly balance required at HDFC Bank and Kotak Mahindra Bank (for edge and classic) savings accounts is Rs 10,000.

Also read: Bandhan Bank and AU Small Finance Bank offer the best rates on savings accounts

Cash withdrawal fees

Axis bank allows four free transactions or cash withdrawals of up to Rs 2 lakh in a month, whichever is earlier. Once the limit is breached, the bank charges Rs 5 per Rs 1,000 withdrawn, subject to a minimum of Rs 150 per transaction.

From May 1, the charges would double. For every Rs 1,000 withdrawn, you will now pay Rs 10 or Rs 150, whichever is higher, for cash withdrawals from the savings account.

However, the cash withdrawal charges at HDFC Bank and ICICI Bank remain same at Rs 5 per Rs 1,000 withdrawn after exceeding free limits, subject to a minimum of Rs 150 per transaction.

According to banking industry sources, cash withdrawal adds to banks’ costs. “By charging cash withdrawal fees after exceeding the free limit, the bank is discouraging cash withdrawals beyond the anticipated average use and seeking increased adoption of digital banking means,” says Parijat Garg, a digital lending consultant.

Also read: Do you know how much your bank charges and penalises you? Read on

SMS Charges

Due to a recent change by the telecom regulator, Axis Bank has also recalibrated its SMS charges. Instead of charging a flat fee of Rs 5 every month, it will now charge 25 paise for every SMS alert, subject to a maximum of Rs 25 per month, effective July 1 (except for one-time passwords and promotional messages) it sends you.

The new telecom regulations mandate bulk messages to confirm to a particular standard. SMS that don’t match this format get blocked. The process of authenticating the SMS alert messages is referred to as ‘scrubbing.’ Industry sources say the new costs are meant to recover the cost of scrubbing messages. Other banks may also announce similar changes in SMS charges.

Premium, staff, pension, small and basic accounts, etc. will not have to incur SMS alert charges.

Axis Bank did not respond to Moneycontrol’s queries on the reasons for increasing charges amidst the raging pandemic.

Also read: How to reactivate your dormant MobiKwik, Paytm and Freecharge mobile wallets

Other bank charges

Apart from these, Axis bank will levy charges on salary account holders. Salary accounts that are more than six months old and do not receive any credit in a month will be levied a fee of Rs 100 per month. “You should close the salary account or convert it into a savings account if you are no longer associated with the employer depositing monthly salary in this account,” says Harshil Morjaria, a certified financial planner at ValueCurve Financial Solutions.

In case your Axis bank account is dormant (no transactions) for a continuous period of 17 months, in the 18th month, there will be a one-time fee of Rs 100 charged by the bank. If you don’t use a particular bank savings account, close it and save on bank charges.
Hiral Thanawala is a personal finance journalist with 8 years of reporting experience. Based in Mumbai, he covers financial planning, banking and fintech segments from personal finance team for Moneycontrol.
TAGS: #banking
first published: Apr 23, 2021 11:49 am

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