Is NEFT Free?

It appears that govt is listening to us as we had raised our voice and asked govt to do away with NEFT & RTGS charges and same appears to become a reality as government has asked the Reserve Bank of India (RBI) to work out a framework under which funds could be transferred electronically free of charge from one account to the other. This good order has come from none other than Finance Minister Pranab Mukherjee ad it speaks of his sensibility.

We had repeatedly raised our voice against any transaction charges for NEFT & RTGS in a number of forums as a free electronic transaction would encourage customers to use this medium for inter-bank as well as intra-bank fund transfer across the country. This also means that number of clients visiting banks will reduce and in turn will reduce their infrastructure and office space demand. Moreover cash movement and cash transaction will reduce and it translates into lesser black money in India being generated.

At present, banks charge between Rs 5 to Rs 55 for electronic transfer of funds from account of one bank to another through National Electronic Fund Transfer (NEFT) and Real Time Gross Settlement (RTGS).

"I would also urge upon Reserve Bank of India (RBI) to proactively work on this front and to see that all electronic banking transactions should be possible without any charges being levied," Mukherjee said.