Withdrawing from ATM now requires some planning

Use ATMs for withdrawing cash and net banking for other purposes. Revive old a/cs to get more free transactions

If you are have an account with State Bank of India, HDFC Bank or Axis Bank you will have to pay higher charges for using ATM more than five times a month. These  banks have hiked the charges for more than five ATM transactions for their own customers and more than three ATM transactions for other bank customers, with effect from November 1. Union Bank of India has hiked the fees for more than eight transactions for its own customers and more than five for other bank customers.

All these banks, barring Union Bank of India, are charging Rs 20 plus service tax for financial transactions above the limit and Rs 8.5 for non-financial transactions. Non-financial transactions include checking the balance, cheque book request and so on. In case of Union Bank of India, it is Rs 15.

So, you are allowed eight free ATM transactions, (five at your bank branch ATM and three at other banks' ATMs). If your sixth ATM transaction in a month is cash withdrawal, then you will be charged Rs 22.47. If it is a cheque book request you will be have to pay Rs 9.55.  

Residents in towns other than  Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad are allowed up to five free transactions in other banks' ATMs.

If you are a salary account holder or have a large balance in your account, the bank may waive off these charges. For instance, if you are an SBI customer and you don't go to the branch, then you will be allowed more than five free ATM transactions. Also, if you have a large balance, the bank will allow unlimited free transactions. But the bank has not specified how many additional free transactions will be allowed.

Similarly, HDFC Bank also allows up to five free transactions to its salary account holders at other bank ATMs, against the normal three. In case of Axis Bank's Prime Plus Savings account holders, the first 10 transactions are free at Axis Bank ATMs, against the first five.

If you have bank accounts in two different banks, use ATMs of both banks. This way you can get up to 10 transactions free in own bank ATMs and up to six free on other bank ATMs. Only remember to maintain sufficient money in both accounts.

The withdrawal limit per transaction is based on the number of notes. This varies from bank-to-bank and is usually 30-40 notes per transaction. So, if there are currency notes of higher denomination in the ATM, you can withdraw a higher amount at one go.

“Most people don't need to withdraw more than Rs 40-50,000 for their monthly cash requirements and this can be done within the eight free transactions you are allowed. Since most banks allow three to four free transactions at the branch, you can withdraw from the branch if you are in urgent need for cash,” says Rahul Soota, executive director and co-promoter of mymoneymantra.com.

Swipe your debit card wherever possible instead of paying by cash and use online banking for fund transfer, utility and credit card payments. The charge for NEFT (the online payment mode for transactions up to Rs 2 lakh) is between Rs 2.5 and Rs 25 for amounts between Rs 10,000 and Rs 2 lakh.

For getting updates on your account balance, opt for alerts through email, which is free, or through SMS, which is Rs 15 per quarter. Save these messages so that you don't need to do an ATM transaction every now and then to know the balance.