RBI Announces ATM Withdrawal Fee Hike from May 1; Kotak Mahindra Bank Revises Charges

The Reserve Bank of India (RBI) has announced that starting from May 1, 2025, ATM withdrawal charges will go up. After using the free ATM transactions allowed every month, customers will now have to pay Rs 23 per transaction, up from the current fee of Rs 21. This move will affect all bank customers across India, especially those who use ATMs frequently.

Even with the hike, customers will still get a set number of free ATM transactions every month. As per RBI rules, people can make five free ATM transactions per month at their own bank's ATM, which includes both withdrawals and non-cash transactions like balance checks. At ATMs of other banks, users in metro cities will get three free transactions, while those in non-metro cities will continue to get five free transactions. Once these limits are crossed, the new fee of Rs 23 will be charged for every extra transaction.

Following the RBI's update, Kotak Mahindra Bank has also revised its ATM transaction charges. The bank has notified customers that the new charges will apply to both financial and non-financial transactions, whether done at Kotak's own ATMs or those of other banks. These changes will be the same for all types of account holders and customer categories. However, the existing free ATM transaction limits will stay the same, based on the specific account type.

Kotak Mahindra Bank has also reminded customers about the daily ATM withdrawal limits. For those having Edge, Pro, or Ace accounts, the maximum withdrawal limit is Rs 1,00,000 per day. For customers with an Easy Pay account, the daily withdrawal cap is Rs 25,000.

The increase in ATM charges means that customers will need to be a little more careful about how often they withdraw cash. Banks, including Kotak, continue to encourage people to use digital payment options like UPI, mobile banking, and internet banking to reduce dependency on cash and avoid paying extra fees. As the new rule kicks in from May 1, planning your ATM visits wisely can help you save money and avoid additional charges.