New Delhi: The Reserve Bank of India (RBI) has ordered banks to stop charging customers for online fund transfer through the Real Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT) system from July 1.
In a press release issued in Mumbai on Tuesday evening, RBI advised banks to pass on the benefits to their customers with effect from 1st July, 2019. The Central bank said the decision had been taken to provide an impetus to digital funds movement.
“It has been decided that with effect from July 1, 2019, processing charges and time-varying charges levied on banks by Reserve Bank of India (RBI) for outward transactions undertaken using the RTGS system, as also the processing charges levied by RBI for transactions processed in NEFT system will be waived by the Reserve Bank,” the bank said.
The directive has been issued under Section 10 (2) read with Section 18 of the Payment and Settlement Systems Act 2007 (Act 51 of 2007).
The RTGS system is meant for high-value transactions with the minimum amount to be remitted through RTGS is ₹2 lakh with no maximum limit. RTGS transactions are carried out in real time. Here the beneficiary bank receives the instruction to transfer funds immediately when customers issue the instructions and the transfer is instantaneous.
The idea behind the move is to encourage the digital transfer of funds.