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ATM cash withdrawals to become expensive from January 1, 2022

ATM cash withdrawals to become expensive from January 1, 2022

ATM cash withdrawal charges are going to increase from next month. Check details here

Customers will continue to get five free transactions, including financial and non-financial transactions, every month from their respective banks Customers will continue to get five free transactions, including financial and non-financial transactions, every month from their respective banks

In 2022, customers will have to pay a higher amount of fees if they exceed the number of free ATM transactions. This is due to the Reserve Bank of India (RBI) allowing banks to hike fees for cash and non-cash ATM transactions beyond the free monthly permissible limit from January 1, 2022, onwards.

Effective January 1, 2022, bank customers will have to pay Rs 21 per transaction instead of Rs 20. However, the fee will now be charged if they exceed the number of free monthly transactions, explained an RBI notification dated June 10, 2021.

The central bank has allowed banks to increase the fee for cash and non-cash ATM transactions beyond the free monthly permissible limit in order to compensate the banks for the higher interchange fee and the general escalation in costs.

"This increase shall be effective from January 1, 2022. Applicable taxes, if any, shall be additionally payable," read the notification.

Customers will continue to get five free transactions, including financial and non-financial transactions, every month from their respective banks. Bank customers would also be able to perform three free transactions from other bank ATMs in metro centres and five free transactions in non-metro centres.

"Customers are eligible for five free transactions (inclusive of financial and non-financial transactions) every month from their own bank ATMs," read the RBI notification.

"They are also eligible for free transactions (inclusive of financial and non-financial transactions) from other bank ATMs viz. three transactions in metro centres and five transactions in non-metro centres," it added.

Some banks have already notified their customers about the fee hike for exceeding monthly free transactions at ATMs. As per the HDFC Bank website, the ATM transaction fee rate beyond the free limit of Rs 20 + taxes will be changed to Rs 21 + taxes as of January 1, 2022. RBI also noted that only cash withdrawal transactions will be hiked for charge at the bank's ATMs.

"Effective 1st January 2022, financial transaction fee above the free limit in Axis Bank or other bank ATMs will be INR 21 + GST," reads Axis Bank's website.

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