MPC Meet: RBI to remove charges on NEFT, RTGS transactions

Monetary Policy Meet: RBI Governor Shaktikanta Das-led six-member monetary policy committee (MPC) has decided to do away with charges levied on Real Time Gross Settlement (RTGS) and National Electronics Funds Transfer (NEFT) transactions. The Reserve Bank has also asked banks to pass on this benefit to their customers.

The State Bank of India charges Rs 2.50 for NEFT transactions up to Rs 10,000, Rs 5 for up to Rs 1 lakh, Rs 15 for between Rs 1 lakh and 2 lakh and Rs 25 for about Rs 2 lakh. When it comes to RTGS charges, the SBI charges begin from Rs 25 for an amount of Rs 2 lakh to Rs 5 lakh.

ICICI Bank, HDFC Bank and PNB charge Rs 2.50 plus applicable GST on an amount of Rs 10,000 in NEFT transactions. For amounts above Rs 10,000 to Rs 1 lakh, these banks charge Rs 5 along with applicable GST, Rs 15 plus GST on amounts between Rs 1 lakh and Rs 2 lakh and Rs 25 plus GST on Rs 5 lakh upwards. Their RTGS charges also begin from Rs 25 plus applicable GST.

The RBI also announced the setting up of a committee involving all stakeholders, under the chairmanship of CEO Indian Banks' Association (IBA). The committee will examine the entire gamut of ATM charges and fees. This committee is scheduled to submit its recommendations within two months of its first meeting.

The RBI also decided to change the stance of monetary policy from neutral to accommodative. This will be more comforting for markets than just a rate cut, especially in light of the slowdown.

In its statement the RBI also said, "After the impact of recent  policy  rate  cuts  and expectations of a normal monsoon in 2019, the path of CPI inflation is revised to 3.0-3.1 per cent for H1: 2019-20 and to 3.4-3.7 per cent for H2:2019-20, with risks broadly balanced."

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