You can make
electronic transfer of funds up to Rs 1 lakh free of cost if public sector banks pay heed to an appeal made by former Finance Minister Pranab Mukherjee.
In a meeting with the chiefs of public sector banks, Mukherjee had urged them to follow the decision of Oriental Bank of Commerce
to waive charges for fund transfers made electronically up to Rs 1 lakh. He also urged the Reserve Bank of India to see that all electronic banking transactions are possible without any charges.
Bank of Baroda has already decided to remove charges on transactions up to Rs 1 lakh made through National Electronic Fund Transfer (NEFT), confirmed the bank's managing director, MD Mallya.
Real Time Gross Settlement (RTGS) allows transfer of funds without delay, while in NEFT, the fund transfer takes place the same day if it is within the cut-off time or the next working day if it is beyond the cut-off time prescribed. While there are no limits for transfer of funds under NEFT, the transaction amount should be at least Rs 2 lakh under RTGS, which is being promoted as the channel for high-value transactions.
At present, banks charge Rs 5 for every outward transaction up to Rs 1 lakh through the NEFT mode, Rs 15 for every transaction between Rs 1 lakh and Rs 2 lakh, and Rs 25 for transactions over Rs 2 lakh.
Under RTGS, banks charge Rs 25 for every transaction between Rs 2 lakh and Rs 5 lakh, and Rs 50 for every transaction above Rs 5 lakh.
Private sector banks, however, remain non-committal on removing electronic transaction charges. ICICI Bank, the largest private sector bank, refused to comment for this story. An email to Kotak Mahindra Bank remained unanswered, while IndusInd Bank spokespersons were unavailable for comment on the issue.
