Top News

If you hold a savings or trust account with Axis Bank or frequently withdraw cash from ATMs, be prepared for a hike in ATM transaction charges starting July 1, 2025. Axis Bank has announced a revision in its fee structure for ATM transactions, following the Reserve Bank of India’s (RBI) updated guidelines, which came into effect on May 1, 2025.

These changes will have a direct impact on your banking expenses, especially if you make multiple withdrawals each month.

What’s Changing for Axis Bank Customers?

Axis Bank has officially declared that starting July 1, ATM withdrawals beyond the free transaction limit will now cost ₹23 per transaction, up from the current fee of ₹21. This revised charge will apply to:

• Axis Bank ATMs

• Other bank ATMs

• Savings account holders

• NRI customers

• Trust accounts

• Certain priority and Burgundy segments

The change affects both cash withdrawals and financial services like balance enquiries done after exceeding the free usage limit.

RBI's New Guidelines: Fewer Free Transactions Allowed

As per the RBI circular issued on March 28, 2025, the central bank has restructured ATM interchange fees and capped the maximum customer charge per additional ATM transaction at ₹23.

The new rule has been in effect since May 1, 2025, and sets limits on the number of free ATM transactions based on your location:

• Metro Cities: Only 3 free transactions per month

• Non-Metro Cities: Up to 5 free transactions per month

These limits include both own-bank and other-bank ATMs. Once this limit is crossed, users will be charged according to the revised structure.

How Does This Compare to Other Banks?

Other major banks have already made similar updates to align with RBI’s guidelines:

• HDFC Bank: Allows 3 free transactions in metro areas and 5 in non-metro areas. After that, it charges ₹23 for cash withdrawals and ₹8.50 for non-financial transactions.

• State Bank of India (SBI): Since February 1, 2025, SBI offers 5 free transactions at SBI ATMs and 10 free transactions at other banks' ATMs to all customers.

These banks are also expected to follow suit with similar hikes in transaction fees to cover the interchange costs levied between banks.

What Is an ATM Interchange Fee?

The ATM interchange fee is the amount that one bank pays another when its customer uses the latter's ATM. For example, if an HDFC Bank customer withdraws cash from an SBI ATM, then HDFC pays a fee to SBI. This fee is typically passed on to the customer after the free limit is exhausted.

What Does It Mean for You?

These changes mean that frequent ATM users will face higher costs if they do not manage their withdrawals strategically. With rising fees and shrinking free usage limits, it's more important than ever to:

• Use digital payments where possible.

• Withdraw cash in larger amounts less frequently to minimize transactions.

• Monitor ATM usage each month to avoid exceeding the free limit.

Final Thoughts

Axis Bank’s move to hike ATM transaction charges is part of a broader trend in the banking industry, aligning with RBI’s push for digitization and cost recovery mechanisms. While the fee increase may appear modest, over time it can significantly impact customers who rely heavily on cash withdrawals.

To reduce banking expenses, users are encouraged to adopt UPI and mobile banking solutions, or plan their ATM usage more carefully in the months ahead.