Bank Transfers To Become Cheaper, More Attractive As RBI Removes Charges On NEFT, RTGS Transactions

Consumers from next week onward may transfer money via Real Time Gross Settlement System (RTGS) and National Electronic Funds Transfer (NEFT) with lesser transaction fee as the Reserve Bank of India (RBI) has decided to eliminate its levy on online payment modes, reports Livemint.

This is another step towards greater goal of encouraging digital payments and making India a less-cash economy.

RBI in a statement said “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."

RBI levies minimum charges on banks for NEFT and RTGS-based transactions, over that, banks imposes their charges on the customers. If the RBI levy is removed, according to Deepak Sharma, Chief Digital Officer at Kotak Mahindra Bank, the use of cheques and the cost of processing them will also be reduced. “It will also boost digital mode of payment," he added.

RBI said that instructions to banks in this regard will be issued within a week. RBI is also exploring the possibility of making NEFT available 24x7.

During 2018-19, 2.3 billion NEFT transactions worth Rs 227.93 trillion were clocked. In case of RTGS, 136.63 million transactions worth Rs 1,715.52 trillion were recorded, RBI data showed.