The Reserve Bank of India Tuesday said it will waive all charges on fund transfer through popular RTGS and NEFT systems from July 1 and asked banks to pass on the benefits to customers from the same day.
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 of up to Rs 2 lakh.
Country's largest bank SBI charges between Re 1 and Rs 5 for transactions through NEFT and between Rs 5 and Rs 50 for RTGS route.
Following up on the announcement made on June 6 after the bi-monthly monetary policy review, the RBI said it has reviewed the various charges levied by it on the member banks for transactions processed in the RTGS and NEFT systems.
In order to provide an impetus to digital funds movement, the central bank further said it has been decided that with effect from July 1, 2019, processing charges and time varying charges levied on banks by RBI for outward transactions through the RTGS, as also the processing charges for transactions processed in NEFT will be waived by the Reserve Bank.
"The banks are advised to pass on the benefits to their customers for undertaking transactions using the RTGS and NEFT systems with effect from July 1, 2019," it said.
The Reserve Bank levies "minimum charges" on banks for transactions routed through its RTGS and NEFT, and banks, in turn, levy charges on their customers.