Federal Bank Hikes Service Charges from June 1 — Here’s What Changes

Federal Bank has announced new service charges effective June 1, 2025, for various banking services like ATM use, locker rent, and minimum balance requirements. These changes aim to better reflect operational costs and encourage digital banking.

ATM Transaction Charges

• Free ATM Use at Federal Bank ATMs: Unlimited free transactions unless stated otherwise.

• Other Bank ATMs:
  • 5 free transactions per month (3 in metro cities, 5 in non-metro areas).

  • After free limit:
    • Cash withdrawal: ₹21 per transaction

    • Non-financial transactions (e.g., balance check): ₹8

    • Failed transaction due to insufficient funds: ₹25

Read More, Crisil Interim Dividend: ₹8 per Share, Ex-Date is Today May 7, 2025. 

Cash Deposit & Withdrawal Charges

• Savings accounts get 5 free cash deposits or withdrawals per month or up to ₹5 lakh (whichever is earlier).

• Beyond this limit:
  • ₹4 per ₹1,000 (or part of it)

  • Minimum charge: ₹100 per transaction

This move is expected to promote digital banking for routine needs.

Minimum Balance Requirement

• Delite and Club savings accounts need a monthly average balance (MAB) of ₹5,000.

• If not maintained, penalty applies based on the shortfall:
  • Up to 20% shortfall: ₹75

  • Over 80% shortfall: up to ₹375

• Senior citizens and rural customers will get reduced penalty rates.

Locker Rent Charges

• Locker rent depends on the branch location and locker size.
  • Rural areas: ₹2,000 to ₹5,500 per year

  • Metro cities: ₹2,950 to ₹12,800 annually

• A refundable key deposit is also applicable.

Other Service Charges

• Inward cheque return: ₹500 (₹400 for seniors and rural customers)

• Account closure:
  • No fee if closed within 14 days of first funding

  • ₹100–₹300 if closed between 6 to 12 months, based on customer category

About Federal Bank

Federal Bank Limited is a private sector bank based in Aluva, Kerala. It operates over 1,588 branches and more than 2,079 ATMs and cash deposit machines (CDMs) across India. The bank also has representative offices in Abu Dhabi and Dubai, extending its presence beyond Indian borders.

As of 1:57 PM IST on May 7, Federal Bank share price is trading at ₹189.81, up ₹2.52 or 1.35% for the day. The stock opened at ₹183.15 and has touched a high of ₹190.30 and a low of ₹183.15 so far. The bank has a market capitalisation of ₹46,620 crore, a price-to-earnings (P/E) ratio of 11.30, and offers a dividend yield of 0.63%. Over the past 52 weeks, the stock has traded between a low of ₹148.00 and a high of ₹217.00.

Conclusion

The new charges reflect Federal Bank’s push toward digital transactions and operational efficiency. Customers should review their account activity and consider switching to digital modes or maintaining required balances to avoid extra fees.

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