RBI to increase ATM withdrawal fee to Rs. 23 for every transaction

In shocking news for the public, the Reserve Bank of India (RBI) has directed banks to increase the ATM withdrawal fee to Rs. 23. It has been announced that a fee of Rs. 23 will be charged for every ATM transaction after customers exceed their free withdrawal limit.
Currently, bank customers can withdraw money from ATMs free of charge up to five times a month. For any withdrawal beyond this limit, a fee of Rs. 21 is currently charged. The RBI has now allowed banks to increase this fee to Rs. 23 from May 1.
With advancements in technology, ATMs have become a convenient way for people to withdraw money anytime, without visiting a bank. Over the years, India has witnessed tremendous growth in digital money transfers. In 2013, electronic money transfers stood at 222 crore transactions, which has now surged to 20,784 crore transactions in 2024, leading to a total transfer of Rs. 2,758 lakh crore.
Among these, UPI transactions through apps like Google Pay and PhonePe account for a significant share. While UPI transactions were 34% of total digital transactions in 2019, they have now risen to 83% in 2024. The 100% growth in UPI transactions is a remarkable achievement.
However, at a time when digital transactions are flourishing, increasing ATM fees will burden the public. If customers return to traditional banking methods going to branches and waiting in long queues to avoid ATM charges it would be a major setback. This is the concern surrounding the RBI’s decision.
Banks exist to serve the people, not as profit-driven businesses. Currently, banks deduct multiple fees, such as minimum balance penalties, without customer consent. Statistics show that banks collect crores in fees and penalties from the public, yet they continue to shift ATM maintenance costs onto customers. ATM expenses should be covered by other banking revenues, rather than imposing direct charges on the people.
No one will willingly accept this additional financial burden!