RBI Removes Charges On Real-Time Gross Settlement (RTGS), National Electronic Funds Transfer (NEFT) Payments
The Reserve Bank of India (RBI) has decided to do away with charges levied on Real-Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT) payments. “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 said in a statement on Thursday. The Real Time Gross Settlement System (RTGS) is meant for large-value instantaneous fund transfers while the National Electronic Funds Transfer (NEFT) System is used for fund transfers up to Rs 2 lakh.
Here are 5 things to know about RBI’s announcement:
1. RBI said it levies minimum charges on banks for transactions routed through RTGS and NEFT system for other fund transfers. Banks, in turn, levy charges on their customers. In order to provide an impetus to digital funds movement, it has been decided to do away with the charges levied by the RBI for transactions processed in the RTGS and NEFT systems, it said.
2. Currently, country’s largest bank State Bank of India (SBI) charges between Re 1 and Rs 5 for transactions through NEFT and between Rs 5 and Rs 50 for RTGS route
3. RBI has also decided to set up a committee to review the charges levied on the use to ATMs as the usage by the public has been growing significantly.
4. “There have, however, been persistent demands to change the ATM charges and fees,” the RBI noted. In order to address these, it has been decided to set up a committee involving all stakeholders, under the chairmanship of the Chief Executive Officer, Indian Banks’ Association (IBA), to examine the entire gamut of ATM charges and fees.
5. Recently, the Reserve Bank of India (RBI) extended the timings applicable to RTGS transfers by one-and-a-half hours.