ATM Usage Changes Impact Indian Banking Customers
Banks like HDFC, PNB, and Bandhan have introduced new policies starting April 1, 2026, affecting free transaction limits and fees. These changes aim to encourage the use of digital banking options.
Highlights
- •HDFC Bank includes UPI cash withdrawals in free transaction counts from 7:30 PM onwards.
- •PNB reduces daily cash withdrawal limits which may vary by card type.
- •Bandhan Bank allows five monthly free financial transactions at their ATMs, with lower fees for non-financial activities.
- •These changes push customers towards digital options like UPI and net banking.
New ATM rules are set to impact banking customers as several major banks update their policies. Starting April 1, 2026, HDFC Bank, Punjab National Bank (PNB), and Bandhan Bank have introduced significant changes in their guidelines. These updates will affect the number of free transactions and fees associated with ATM cash withdrawals and UPI payments. For instance, HDFC Bank is altering its free transaction policy to account for cardless cash withdrawals made via UPI.
HDFC Bank's New Guidelines
Customers will now find that any cash withdrawal through UPI will be counted as a standard ATM transaction. HDFC Bank currently allows five free transactions at one's own ATMs, and up to three in metro areas or five in non-metro regions for other banks' ATMs. For activities made after 7:30 PM, HDFC notes that these are recorded for the following day. Additionally, transactions on the last day of the month contribute towards the next month's quota.
Punjab National Bank's Limits
An even more restrictive policy comes into play with Punjab National Bank (PNB), which has significantly reduced daily cash withdrawal limits. These limitations, however, may vary based on different card types, so customers are advised to verify their specific new limit.
Beyond cash withdrawals, Bandhan Bank's revised rules focus on the number of free financial transactions. At their own ATMs, customers can now enjoy five free transactions each month. Meanwhile, free non-financial transactions like balance inquiries remain unlimited at all ATMs. For these other banks' ATMs, three free transactions are granted in metro cities while five are available in non-metro ones.
After these limits are reached, fees start: ₹23 for financial transactions and ₹10 for non-financial activities at Bandhan Bank. Such modifications suggest a subtle shift towards encouraging digital banking, reducing reliance on traditional ATM usage to minimize costs.
Rising Trends in Digital Banking
These updates reflect broader trends in the Indian banking sector, where a significant number of ATMs (over 250,000) are being leveraged alongside growing digital payment platforms. Banks are now pushing customers towards more efficient and cost-saving alternatives like UPI and net banking to reduce ATM transactions significantly.
