HomeBusinessPay More For ATM Transactions Over Free Limit From 1st January

Pay More For ATM Transactions Over Free Limit From 1st January

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ATM Withdrawal Charges 2022: If you withdraw money from ATMs frequently, then soon, your pocket is going to get hit a little more. From January 1, doing more than one limited transaction from your own or any other bank’s ATM will become costly. RBI had long ago allowed banks to increase cash and non-cash transaction charges. Banks have started preparing to implement it from January 1.

How much increase?

Currently, banks charge Rs 20 plus 18% GST on every transaction over and above the free monthly transaction limit. From January 1, it will be Rs 21 per transaction plus GST.

What is the free limit?

Till now, any customer can do five transactions every month for free from his bank’s ATM. The transaction means whether you withdraw cash or mini statement, it is free only five times. After that, there are charges.

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At present, there has been no cut or increase in the limit. Every month three transactions in metro cities and 5 in non-metro towns can be done free from ATMs of other banks. There has been no change in this limit as well. But above this, instead of Rs 20 plus tax, you will have to pay Rs 21 plus tax.

Preparation of banks

RBI had issued instructions in this regard long ago, but now banks have started informing customers through their portal and other means. HDFC Bank and Axis Bank have issued a notice on their websites that from January 1, 2022, the increased rates will be applicable after the free monthly limit of cash and non-cash transactions through ATMs.

How much inclusive of tax?

The GST rate on ATM transaction services is 18%. In such a situation, with Rs 21, you will have to pay an additional Rs 3.78. In such a situation, after the free limit, Rs 24.78 will be deducted from your account per transaction, which used to be Rs 23.60 earlier.

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Why are the charges increasing?

There are two reasons for this charge increase. The first banks demanded permission from the RBI to increase the transaction charges, citing the cost of maintaining ATMs and inflation. Second, both banks and the government want people to use ATMs to a minimum.

In such a situation, the increase in transaction charges can be an exercise to discourage customers from cash transactions. The cost of an ATM does include the cost of maintenance and security of the machine and the cost of cash handling.

Geeta Kumar
Geeta Kumar
Geeta Kumar is Our Digital Media Specialist at Spot News 18. She Manages our Digital Media Account Globally. She loves to be connected on Social Media.

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