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Now avail NEFT fund transfer 24×7

Customers can now transfer money through NEFT without paying any charges any time of the day whereas banks charge a fee for fund transfer through cheques and demand draft (DD).

By: ENS Economic Bureau | Mumbai |
Updated: December 17, 2019 12:41:03 pm
According to the RBI, there were 23188.87 lakh NEFT transactions valued at Rs 227,93,608 crore in 2018-19.

Giving a big boost to digital funds movement, the Reserve Bank of India (RBI) on Monday operationalised round-the-clock (24 X 7 basis) availability of the National Electronic Fund Transfer (NEFT) and asked the banks not to levy any charges on NEFT transfer from savings bank account holders.

Customers can now transfer money through NEFT without paying any charges any time of the day whereas banks charge a fee for fund transfer through cheques and demand draft (DD).

“In order to give further impetus to digital retail payments, it has now been decided that member banks shall not levy any charges from their savings bank account holders for funds transfers done through NEFT system which are initiated online (internet banking and/ or mobile apps of the banks),” the RBI said in a circular to the CEOs of banks.

“The RBI operationalised NEFT on 24X7 basis from today 12.00 am. This ensures anytime availability of anytime electronic fund transfer. The RBI now joins an elite club of countries having payment systems which enable round-the-clock fund transfer and settlement of any value,” the RBI tweeted on Monday.

“Between 12.00 am and 8.00 am this morning (Monday), NEFT settled over 11.40 lakh transactions,” the RBI said.

In June this year, the RBI had said that processing charges and time varying charges levied on banks by Reserve Bank 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 RBI with effect from July 1, 2019.

According to the RBI, there were 23188.87 lakh NEFT transactions valued at Rs 227,93,608 crore in 2018-19.

This is expected to rise significantly with the round-the-clock NEFT transfer availability.

The NEFT system, introduced in 2005, has seen exponential growth in recent years reflecting its popularity as well as increasing customer acceptance. Despite such growth, many banks continued to levy the maximum permissible charges to their customers.

It is desirable that the benefits accruing on account of increasing volume of transactions are passed on to the customers so as to incentivise greater use of the electronic payment system in place of cumbersome paper-based mechanism like cheques/DDs.

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