The Reserve Bank of India (RBI) has directed banks not to charge savings account holders for NEFT with impact from January 2020.
RBI: Savings Accounts Holders Will Not Have the NEFT Charges from January 2020
The National Electronic Funds Transfer (NEFT) is an electronic funds transfer system kept up by the RBI, to transfer funds starting with one account to another account. Cash transfer can be made by a person or organization to a person or organization’s account with any bank that is a person from the NEFT plot, as per the RBI. The RBI said before that it had discarded charges on NEFT and RTGS transactions.
“In order to provide an impetus to digital funds movement, it has been decided to do away with the charges levied by the Reserve Bank for transactions processed in the RTGS and NEFT systems. Banks will be required, in turn, to pass these benefits to their customers. Instructions to banks in this regard will be issued within a week,” the central bank had said in a statement.
At present, for RTGS transactions between Rs 2-5 lakh, a maximum fee of Rs 30 is charged, while for transfers above Rs 5 lakh, a limit of Rs 55 is charged. In any case, the actual charge relies upon the time when a client starts transactions. Banks could choose to charge any sum not surpassing the rates stipulated by RBI.
Essentially, for NEFT transactions beginning at bank offices, a limit of Rs 2.50 (+GST) is charged for transactions to Rs 10,000. For transactions above Rs 10,000 up to Rs 1 lakh, a limit of Rs 5 (+GST), and Rs 15 (+GST) for transactions above Rs 1 lakh and up to Rs 2 lakh is charged. For transactions above Rs 2 lakh, a limit of Rs 25(+GST) is charged.
RTGS is intended for huge worth instantaneous fund transfers while the NEFT is used for support transfer up to Rs 2 lakh.