GUWAHATI: The Reserve Bank of India has greenlighted a hike in ATM interchange fees, which will raise the cost of cash withdrawals and balance checks for customers using non-home bank network ATMs. The revised charges will come into effect from May 1, according to reports.
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After the revision, cash withdrawal fee will be ₹19 per transaction, up from ₹17; Balance inquiry fee will be ₹7 per transaction, up from ₹6.
These charges will apply once users exhaust their free monthly limits — five transactions in metro cities and three in non-metro areas at other banks' ATMs.
The RBI approved the revision based on a proposal by the National Payments Corporation of India (NPCI). White-label ATM operators – non-banking entities -- had been lobbying for an increase, arguing that the old fees were unsustainable given rising operational costs.
Smaller banks are likely to feel the pressure more, as they rely heavily on other banks' ATM networks due to their limited infrastructure. The increased interchange fee — the amount one bank pays another when a customer uses a different bank’s ATM — will now be passed more directly to customers.
With these higher charges kicking in, frequent ATM users may want to stick to their home bank’s ATMs or shift towards digital payment methods to avoid additional fees.
