Banking New Rules 2025 : If you hold a bank account in India, your eyes need to be glued to the new banking rules implemented in 2025. From transaction limits to KYC updates, the Reserve Bank of India and the major banks have wrought substantial change meant at increased security, improved customer service, and the push for digital adoption. These changes concern millions of account holders across savings, current, and salaried accounts.
1. Tougher KYC Norms With Annual Updates
To check financial fraud and promote transparency, there have been greater restrictions on KYC requirements. Account holders need to update KYC documents once a year from either an online source or from the branch. Banks have introduced measures for easy KYC updates through their app and net banking facility, but if you do not update your KYC on time, this may lead to freezing of your account or blocking certain transactions through your account. These KYC requirements would be paramount for senior citizens, NRIs, and holders of dormant accounts. KYC reminders shall be sent out automatically by the banks at least 30 days before the deadline by SMS and mails.
2. New Cash Withdrawal Limits And Charges
The cash withdrawal limit for free transactions from branches and ATMs was modified with effect from April 1, 2025. Now, holders of savings accounts have been given a provision to withdraw cash free-of-charge thrice every month; beyond that, a nominal fee of ₹25 per transaction is being levied. To promote digital transactions, banks offer cashbacks and waiver of fees to those who choose to transact via UPI or mobile apps instead of withdrawing cash. Rural branches and Jan Dhan account holders are, however, exempted from this fee under special RBI directives.
3. Dormant Account Policy Revised
Accounts will be labelled dormant after just 12 months of inactivity instead of the previous 24 months. If you have had no transactions, either online or offline, for 12 months in a row, your account will probably be treated as inactive. To reopen a dormant account, customers must now do an e-KYC verification and conduct a transaction (deposit or fund transfer). Banks will notify users through different channels before the status alteration.
4. Auto-Debit Mandate System Overhauled
Starting from January 2025, every auto-debit mandate must be authenticated by OTP verification at least once every six months. The auto-debit may be related to EMIs, insurance premiums, or even subscriptions, and international recurring payments are also subjected to the policy. Therefore, this step has been taken to empower the users with more power over transactions done on a recurring basis and also to alleviate any unjust charges on their bank account. Notifications will be sent 24 hours in advance seeking approval for the mandate renewal.
5. Instant Bank Switching Via UPI ID
A major tech-forward development now allows users to switch banks linked to their UPI ID without generating a new UPI ID. This bundling of services allows seamless portability and benefits salary account holders who want to change their bank without disrupting digital payment activities. The most important banks implementing this across their apps are SBI, HDFC, and ICICI.
Stay Informed, Stay Secure
Banking Laws 2025 put forth better security, efficiency, and convenience for Indian accountholders. It, however, remains crucial for the customers to stay informed and act. Avoiding unnecessary charges or disruptions can be facilitated by keeping your KYC updated, keeping your account active, switching to digital modes, and understanding the new auto-debit norms.
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