The banking sector in India is constantly changing, causing customers to face new terms and conditions from time to time. Since 1 May 2025, some significant changes are going to be implemented for all bank customers. These changes will directly affect your bank accounts, ATM transactions and facilities like minimum balance.
The purpose of these new rules is to make banking services more transparent, safe and digital friendly. However, due to these changes, customers will have to make some necessary changes in their banking habits, so that they can avoid unnecessary fees and troubles.
In this article, we will know in detail that what are the three major rules of banking to be implemented from May 1, 2025, what will be the effect on your financial life, and what is important to take care of.
New banking rules from 1 May 2025 – Chief Information
Following are the three main banking rules to be implemented from 1 May 2025:
- ATM withdrawal fee increases
- Changes in minimum balance limit
- Amendment in digital banking and other charges
Understanding these rules is essential for every bank customer, so that they can activate and protect their account.
Summary of new banking rules (Table overview)
| Rule / change | Main details |
| ATM Fee (ATM FEE) | ₹ 23 charge on every withdrawal after free limit (earlier ₹ 21) |
| Free ATM Transaction | 5 free from your bank’s ATM, 3 in metro from other bank ATMs, 5 free in non-metro |
| Minimum balance limit | ₹ 5,000 in urban branches, ₹ 2,000 in semi-urban/rural |
| Penalty for not keeping minimum balance | Starting at ₹ 100, can increase according to the type of account |
| Rebate for digital account | No compulsion of minimum balance in digital/student account |
| Non-Financial Transaction Fee | Increase in fee on balance inquiry etc. |
| UPI/Online Transaction | Changes in limit and fee in some banks |
| Safety features | Positive pay system, 2-factor authentication, biometric login |
1. Changes in ATM Fee (ATM FEE HIKE 2025)
Withdraw money from ATM now expensive
From 1 May 2025, withdrawing money from ATM will become expensive before. RBI has approved an increase in ATM fee. Now if you cross your free transaction limit, then you have to pay ₹ 23 on every additional transaction, whereas earlier it was ₹ 21.
- Free Limit:
- 5 free transactions every month from your bank’s ATM
- 3 free transactions in other banks from ATM to Metro cities, 5 free transactions in non-metro
- After the free limit:
- ₹ 23 charge on every additional withdrawal
- Fee has also been increased on non-Financial transactions like balance check
Who will have the most effect?
- Customers who repeatedly withdraw money from ATMs will have the most impact.
- Customers of small banks, who have low ATMs of their bank, will have to pay more fees on the ATMs of other banks.
How to rescue?
- Try to do ATM transactions inside the free limit in the month.
- Use more facilities like digital payment, UPI, Netbanking.
2. Changes in minimum balance limit (Minimum Balance Limit Rule 2025)
What are the new rules?
- The minimum balance has been increased to ₹ 5,000 for urban branches (earlier ₹ 3,000).
- This limit will be ₹ 2,000 for semi-urban and rural branches.
- If you do not have a minimum balance, then a fine of ₹ 100 to ₹ 300 can be imposed every month.
| Account type | Old MAB (₹) | New MAB (₹) | Fined (minimum) |
| Urban | 3,000 | 5,000 | ₹ 100 – ₹ 300 |
| Semi-urban | 2,000 | 2,000 | ₹ 50 – ₹ 200 |
| Rural | 2,000 | 2,000 | ₹ 50 |
| Digital/student | 0 | 0 | nobody |
Who will get a discount?
- There will be no compulsion of minimum balance in digital account and student account.
- Pensioners, senior citizens and some special account holders may also get exemption (as per the bank policy).
Suggestions for customers
- Keep checking your account balance regularly.
- If it is difficult to maintain a minimum balance, choose a digital or basic savings account.
3. Digital Banking & Other Charges
Promotion of digital banking
- Banks have added new features to make digital banking more safe and convenient.
- Security facilities such as 2-Factors Authentication, biometric login, and positive pay systems are being implemented.
- Some banks have also made changes in the limit and fee of UPI and online transactions.
What will change for customers?
- The limit of online transactions may increase, which will make the transfer of large amount easier.
- Some banks have implemented merchant charge or interchange fee on UPI transactions.
- Positive pay systems have been made mandatory for check payment, which will reduce the chances of fraud.
Impact of new rules – benefits and disadvantages
Benefits:
- Banking services will be more secure and transparent.
- Digital banking will be promoted.
- Customers will get a chance to monitor their financial health.
Loss:
- Repeated use of ATM will affect pockets.
- Those who do not have minimum balance will have to pay fine every month.
- Digital transactions may face problems for customers in rural and small towns.
Necessary tips for customers
- Keep in mind the ATM transaction limit – fee will increase after the free limit.
- Maintain minimum balance – Avoid unnecessary penalty.
- Use more digital banking – Facilities like UPI, IMPS, NEFT are cheaper and fast.
- Keep reading your bank notification and SMS alert – information about any change will continue to be received on time.
- If you are a student or digital account holder, take advantage of MAB discount.
Frequently asked questions on new banking rules (FAQ)
Q1. Will all banks increase the ATM fee?
Yes, according to the RBI instructions, after the free limit in all banks, the transaction fee will be ₹ 23.
Q2. Is there any change in free ATM transaction limit?
No, the free transaction limit will remain the same-5 free transactions from their bank’s ATM, 3 from other bank ATMs and 5 in non-Metro.
Q3. How much penalty will not be imposed for not keeping minimum balance?
₹ 100 to ₹ 300 in urban branches, ₹ 50 to ₹ 200 in Semi-urban, ₹ 50 per month in rural. The penalty will depend on the type of bank and account.
Q4. Is it necessary to keep a minimum balance in a digital account?
No, there is no compulsion of minimum balance in digital and student account.
Q5. Will these rules apply to all banks?
Yes, these rules will apply to all public and private banks. Some banks may also make additional discounts or changes at their convenience.
conclusion
These three major rules of banking to be implemented from 1 May 2025 are important for every bank customer. ATM fees increase, minimum balance limit change and digital banking features – all these changes demand more vigilance and awareness from customers. If you take care of these rules, not only you can avoid unnecessary fees, but can also improve your banking experience.
Our advice:
- Keep your account information updated from time to time.
- Take the maximum advantage of digital banking.
- Use ATM inside the free limit.
- Must fulfill the conditions of minimum balance.
Disclaimer
This article is based on banking rules to be implemented from 1 May 2025. All information is based on various media reports and notifications released by banks. Changes in the rules may occur according to the new guidelines of the bank or the RBI. Be sure to make official confirmation from your bank before any financial decision. The purpose of the article is only to give information, not to give any kind of financial advice.
