- The free transaction limit of 3 transactions is only applicable to Metro cities (Bangalore, Chennai, Delhi, Hyderabad, Kolkata, and Mumbai). For all other locations, the limit is 5.
- The free transaction limit is not applicable to no-frills or small savings accounts.
- Banks can choose to offer a higher number of free transactions if they wish to.
The Reserve Bank of India rolled out a policy in August 2014, pertaining to the amount and the number of ATM transactions offered by banks for free of charge. According to this policy, banks were instructed to provide a certain number of transactions free of cost to customers every month. As per the change in the policy, customers would be eligible for 3 free transactions instead of the earlier 5 free transactions by debit card. This rule is applicable in 6 metro cities, namely Mumbai, Delhi, Bangalore, Chennai, Kolkata, and Hyderabad. Not to forget, free transactions consist of both financial and non-financial transactions. Non-financial transactions include services such as balance enquiry, changing the ATM pin, mini statement, and booking a Fixed Deposit. Cash payment, cash withdrawal and the like will come under financial transactions. The policy also stated that once the number of free transactions has been utilised by the customer, a nominal fee will be charged per transaction which will be decided by the bank. The maximum fee that can be charged per transaction is Rs.20.
As the effect of demonetisation is still experienced by many citizens, they assumed that the government will instruct the banks to not charge fees on ATM transactions till the situation returns to normal. People were expecting a waiver even after Dec 31st, 2016. But the Reserve Bank of India remained silent on the issue and banks started to charge for all ATM transactions after the free limit. However, few public sector banks like Bank of India is not charging for ATM transactions till March 31st of 2017. The RBI has also declared that from 1st January, 2017, Merchant Discount Rate on transactions will be capped at 0.5% for transactions up to Rs.1,000 and 0.25% for transactions more than Rs.1,000 but less than Rs.2,000.
Revised Charges for ATM Transactions
Post demonetisation, the daily withdrawal amount has been increased from Rs.4,500 to Rs.10,000 since 16th January 2017. Refer to the table below for the existing number of free transactions and the fees involved for transactions beyond the free limit.
|Name of Bank||Free transactions allowed (each month)||Fees for Transactions Beyond Free Limit|
|Own Bank ATM||Other Bank ATM||Financial||Non-Financial|
|Axis Bank||5||3||Rs. 20+ GST||Rs. 9.55|
|ICICI Bank||5||3||Rs. 20+ GST||Rs.8.50 + GST|
|Bank of Baroda||Unlimited||Depends on the policies of those banks||Rs.20 + GST||Rs.10 + GST|
|HDFC Bank||5||3||Rs.20 + GST||Rs.8.50 + GST|
|State Bank of India||Unlimited (for salary accounts)||Unlimited (for salary accounts)||-||-|
|Kotak||Unlimited||5||Rs.20 + GST||Rs.8.50 + GST|
|Canara Bank||Unlimited||5||Rs.20 + GST||Rs.10 + GST|
|Punjab National Bank||Unlimited||5||Rs.20||Rs.20|
Terms and Conditions:
- IDBI Bank account holders can make unlimited transactions at their bank ATMs.
- ICICI Bank will not levy ATM transaction charges on some of its Savings Account offerings such as Freedom, Privilege Senior Citizens and Silver Savings Accounts.
- State Bank of India account holders will have unlimited free transactions at the bank’s ATMs if a monthly average balance of Rs.25,000 is maintained. Refer the below table for more information on ATM withdrawal limit and charges.
ATM withdrawal charges for SBI
|Average Monthly Balance (Charges based on number of transactions)||Same branch ATMs||Other Bank ATMs (metro)||Other Bank ATMs (non-metro)|
|>Rs.1000 and up to Rs.25,000||5||3||5|
|>Rs.25,000 up to Rs.50,000||Unlimited||3||5|
|>Rs.50,000 up to Rs.1,00,000||Unlimited||3||5|
Revision of SBI Service Charges (Modifications and Additions that will be effective on and from June 1, 2017)
|Description of the Service Charges||Revised Rates|
|Service Charges for the exchange of Imperfect or Soiled Notes|
|Value up to Rs.5,000 and up to 20 pieces||Nil charges|
|Charges for IMPS transfer of funds via INB, MB, OPI or USSD|
|More than Rs.1 lakh and up to Rs.2 lakh||Rs.15 + GST|
|More than Rs.2 lakh and up to Rs.5 lakh||Rs.25 + GST|
|Up to Rs.1 lakh||Rs.5 + GST|
|Above 20 pieces and/or value above Rs.5,000|
|Above 20 pieces||Rs.2 for each piece on the entire tender along with GST.|
|Rs.2 for each piece or Rs.5 for 1000 along with GST, whichever is more on the entire tender.|
|Example: Rs.500 (25 pieces) is equal to Rs.12,500 Charges Rs.2 for each piece: Rs.50 + GST Charges at the rate of Rs.5 for each Rs.1000: Rs.62.50 + GST Amount that is chargeable is equal to Rs.62.50 + GST|
|Applicable for the SBI Buddy Wallet customers|
|Service Charges for State Bank Buddy|
|Cash deposit in to the Wallet via BC (Business Correspondent)||0.25% of the total transaction value (Minimum of Rs.2 and Maximum of Rs.8) + GST.|
|Cash withdrawal from the Wallet Balance vis BC (Business Correspondent) – up to Rs.2,000 in multiples of Rs.100||2.50% of the transaction value (Minimum amount of Rs.6) + GST.|
|Cash withdrawal from the Wallet Balance vis ATM||Rs.25 for each transaction.|
|Service charges for the BSBD (Basic Savings Bank Deposit) accounts|
|Cheque Book issuance||Cheque Book with 50 leaves – Rs.150 + GST. Cheque Book with 25 leaves – Rs.75 + GST. Cheque Book with 10 leaves – Rs.30 + GST.|
|ATM Card issuance||The RuPay Classic card is the only card that comes free of cost.|
|Withdrawals||4 withdrawals in 1 month free of charges. This includes ATM withdrawals too. After the 4 withdrawals are complete:
How to Avoid ATM Transaction Charges
When we’re in need of quick cash, most of us rush to the nearest ATM as a matter of habit. With ATMs in nearly every location, convenience plays a part as well. However with the new changes in ATM transaction charges, making multiple trips to withdraw cash or check your balance will cost you over the long run. Here are tips to avoid having to pay a hefty charge:
Reduce the number of times you need to withdraw by swiping your card instead of paying cash. A number of merchants and vendors now use card readers, saving you the trouble of finding an ATM and the transaction charges.
Pay your bills online. Move with the times and make your bill payments directly from your bank account.
Save your free transactions for withdrawals only. Make non-financial transactions like balance enquiries, mini statements etc., through a facility such as mobile banking.
Make use of your bank’s online platform to conduct financial transactions. You could download their banking app or use their online/ net banking feature.
Using the above tips will help you save on charges and save your free transactions for emergency cash withdrawals without having to pay the hefty fees now associated with them.
GST of 18% is applicable on all banking products and services from July 1, 2017 onwards.