UPI Vs Cash Withdrawal: Why GPay, PayTM, BHIM Will Be Your Best Options Post May 1

From May 1, 2025, withdrawing cash from ATMs will cost more. The Reserve Bank of India (RBI) has approved an increase in ATM fees, which means customers withdrawing cash beyond their free limit will have to pay extra charges. With these rising costs, digital payment options like GPay, Paytm, and BHIM UPI are now the smarter choice.

 This means customers may have to pay higher charges when using ATMs beyond their free transaction limit.

New ATM Charges from May 1

According to RBI's regulations, the revised charges are:

Cash Withdrawals: Increased by Rs 2, now Rs 19 per transaction.

Non-Cash Transactions (like balance inquiry): Increased by Rs 1, now Rs 7 per transaction.

Most banks allow 3-5 free ATM transactions per month, after which these charges apply.

Why Are ATM Charges Increasing?

The last fee hike was in 2021. Since then, the cost of maintaining ATMs has increased, and fewer people are using cash due to the rise of digital payments. To cover these costs, banks and ATM operators have pushed for higher withdrawal fees.

Why UPI is a Better Option?

As ATM fees go up, GPay, Paytm, and BHIM UPI offer a free and easy alternative for payments. Here’s why UPI is a better choice:

No Extra Charges – Unlike ATM withdrawals, UPI transactions are free.
Easy & Fast – No need to carry cash or cards; payments happen instantly.
Accepted Everywhere – From small shops to big stores, UPI is widely used.
Secure Transactions – Payments are encrypted and safe.

UPI ATMs: A New Alternative

To reduce cash dependency, UPI ATMs are being introduced, allowing people to withdraw money without a debit card. This feature is expected to grow, making cashless payments even more popular.
With ATM fees rising, digital payments through UPI are the smarter and cheaper way to transact.