Wednesday, 16 January, 2019

Private banks to charge Rs150 per cash transactions after four per month

HDFC ICICI and other banks start charging Rs 150 after four free transactions a month Private banks to charge Rs150 per cash transactions after four per month
Melinda Barton | 03 March, 2017, 02:09

Before the common man could recover from the shock of currency crisis, here comes one more shock as the private banks including HDFC Bank, Axis Bank and ICICI Bank started charging Rs 150 as minimum amount per transaction for all the cash withdrawals and deposits after crossing the limit of four free transactions in a month.

Axis BankAxis bank will charge Rs 5 per thousand or Rs 150 whichever is higher, and it is applicable only on saving accounts after four free transactions. It is free of charge for the first four transactions in a month, thereafter Rs 150 per transaction in the calendar month.

In a circular, HDFC Bank said, "The charges would apply to savings as well as salary accounts effective Wednesday". ATM interchange charges, however, have been re-introduced.

However, experts believe that many other small private banks who have not imposed transaction charges such as Indusind bank, Bandhan bank, Kotak Mahindra, Yes Bank, etc., are taking this as an opportunity to attract customers to shift their accounts and increase their deposit base.

Union Finance Minister Arun Jaitley, while presenting the Budget, already implemented one of the SIT recommendations of allowing no transactions above Rs 3 lakh in cash. But if the amount is more, customers will be charged Rs 5 per Rs 1,000 extra or a minimum amount of Rs 150.

This change in the rules and regulations of the private banks are going have a huge impact on the account holders in the banks. "We do visit banks for deposits and withdrawals, said a customer of HDFC bank at Noida Sector 16", he added.

- Charges apply for cash deposits too.

The Supreme Court-constituted SIT in July past year had recommended a cap of Rs 3 lakh on cash transactions and Rs 15 lakh on cash holdings. From 5 transaction, the customers will have to pay Rs.150 excluding taxes and cess.

HDFC and ICICI have been highly profitable in the last four quarters.

Axis Bank said that five transactions or Rs 10 lakh, whichever is earlier, for cash deposits or withdrawals are free. Is this a general business decision, or is there a government push for this? "Fifth transaction onwards Rs 150 per transaction (plus taxes and cess) would be levied", HDFC Bank said in a statement.

"The bank is restoring the practice that existed before November 8 (when demonetisation was announced)". Axis bank does not differentiate between home and non-home branches.