State Bank of India has announced a significant reduction in free monthly ATM transactions for salary package account holders using other banks’ machines, which could increase costs for customers relying on cash withdrawals.
State Bank of India has cut the number of free monthly ATM transactions for salary package account holders who use other banks’ machines, a change that will make cash access more expensive for many customers from 1 October 2026.
Under the revised rules, SBI salary package customers will get five free transactions a month at other banks’ ATMs and automated deposit-cum-withdrawal machines, down from 10 previously. The allowance covers both cash withdrawals and non-financial actions such as balance enquiries, according to reporting by ZeeBiz and Livemint. Once the free limit is used up, SBI will charge Rs 23 plus GST for each cash withdrawal and Rs 11 plus GST for non-financial transactions at other banks’ machines.
The extra cost can mount quickly for anyone who still relies on cash. At 18 per cent GST, one additional cash withdrawal works out at Rs 27.14. Three such withdrawals would cost Rs 81.42, while five would come to Rs 135.70. If a customer continued making 10 cash withdrawals a month at other banks’ ATMs, the first five would remain free, but the next five would attract charges that add up to about Rs 135.70 a month, or more than Rs 1,600 over a year.
The change does not affect SBI’s own ATMs, where salary package customers will continue to get unlimited free transactions, according to the revised structure reported by the publications. That means customers who want to avoid fees may be better off using SBI machines once they near the five-transaction cap at other banks. The rule also leaves regular savings accounts on their existing terms: customers generally still get five free transactions a month at other banks’ ATMs and 10 cash transactions at SBI’s own ATMs, while Basic Savings Bank Deposit account holders remain subject to a separate limit of four free cash withdrawals a month.
For customers trying to keep costs down, the simplest step is to track ATM use carefully and avoid small, repeated withdrawals. Using digital payments where possible can also reduce the need for cash, while consolidating withdrawals into fewer transactions may help salary account holders stay within the free allowance.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
