But now HDFC Bank has decided to charge for NEFT ( National Electronic Fund Transfer ) henceforth at the rate of Rs. 5 plus taxes for every transaction. This may have something to do with RBI's decision not to waive off charges after March 31,2009. Also Rs. 5 was the upper limit for charges specified by the RBI for transactions not exceeding Rs. 1 Lakh.
Similarly Axis Bank has introduced some security features to use NEFT facility online for which they will charge an annual fees. But most of these security features like code on SMS are offered free of cost by other banks like ICICI & Citibank. Then why does Axis Bank has to charge for a security feature which is provided free of cost by other private banks which have similar AQB requirements? And you can't use NEFT online with Axis Bank without having these security features so there is no other option to the customer than to pay.
Also HDFC Bank by levying charges for NEFT fails to understand that Indian customers are very price sensitive and even if 25% of the transactions which happen on NEFT presently shift to cheques then their work will increase manifold. Since processing of cheques requires human intervention & lot of paper work but NEFT processing is almost completely done by computers.
I believe HDFC Bank is taking a chance here, they are waiting to see the response of their competitors and customers.
Hi,
ReplyDeleteI follow your articles with interest always.
I am surprised that you say ICICI does not charge NEFT charges. ICICI has been charging Rs 25 plus service tax for almost 2 years now whenever i pay my credit card bills through my ICICI bank account. The credit cards are from non-ICICI banks. Isnt that a NEFT charge? I am quite sure it is because I can pay only during normal working hours online (I suppose NEFT has work timings).
It would be great if you can clarify.
Thanks,
Vijay
Ridiculous, if you ask me. I plan to close my HDFC account of 7 years. Ever since NEFT was introduced, I have stopped writing cheques. It is so convenient and hassle-free. Not that it is only beneficial for us customers, it saves a lot of moolah for the bank as well. May be they are doing their part to support employment by hiring a few hundred cheque-processors all over the country.
ReplyDeleteThey are going backwards in this age of innovation. God help them!
Charging for NEFT transactions is stupidity. Imagine the cost of cheque transactions ...
ReplyDelete1. Put more people to work on clearing than to serve customers.
2. Time invovlved. Its even beneficial for the banls too to have money quicky credited to them.
3. Less paper, special cheque paper, YOU SAVE TREES...
These stupid banks.
I agree with the author, many Indians will move to cheque clearings and this will burden the banks only.
A normal saving bank account holder already maintain 10,000 bucks with you and still after that you ask him for NEFT transactions.
Even guys at RBI are idiots.
Looks like banks are looking other-way to cut customer's pocket.
ReplyDeleteWell I have registered my complain as feedback to HDFC bank, pls you all also do the same.
I don't see any logic for charging anything which is done through netbanking. Netbanking is something which is good for banks as well as customer, and banks too gets minimize their effort.
I have been bewildered exactly about the same thing for weeks now. Axis bank is really stupid in a lot of ways, compared to a technologically advanced bank like Citibank. Following are but a few of them:
ReplyDelete1. You have to go to the bank for requesting address change. And you can't just go to a branch near you, you MUST go to YOUR branch! What the heck, I have an online account and only I have the password for it, why can't I do it online, like with the other banks like Citi?
2. They have now brought in some stupid innovation called net secure, and the only free option is to register through SMS. That means a person like me who has gone abroad for a couple of years, and has no valid mobile phone no. in India (they are so poor and can't send international SMS), cannot avail of this. And no, I can't give some close relative's mobile no. because I need to go to the bank to have it registered for my a/c first! So the only option is to go for the paid ones which also AFAIK requires you to go to the bank. Heck!
I have a feeling these banks have never grown and are still in the 18th or 19th century!
Needless to say I cleared out all the money I had in Axis and moved it to my Citi.
Yes Citi charges the Rs.5, but if all the banks are doing it then I can only blame RBI and the finance ministry to pushing the banks to do it.
I have heard stories about Citi charging more fees, but as their customer for 5 years I can tell you that their service is on par with international standards and you can do most of the things with just a few mouse clicks, and atleast I haven't had any unnecessary charges so far.
Yes if it so happens that you want some service that can only be done from the branch, then their fees might be a bit higher than their peers, but how else will they provide better service than others?
AFAIK banks like SBI, IOB, IB, Axis, etc. are only for the lazy old Govt. employees and not for the busy and enthusiastic youths like us who dream about a developed India. Walk into any of these banks' branches and you can see a massive crowd wasting so much productive time sitting with their PASSBOOKS on an office hour on a weekday. God save India.
-M
Hi,
ReplyDeleteThank you for this article. ICICI bank started charging from Aug, 24th 2009. You can read the details here:
ICICI Bank Charges for NEFT Transaction
axis bank now shows netsecure via sms/webpin as free!!! looks like if customers reject ridiculous charges by avoiding the service, the banks decide to give it for free...
ReplyDeletebtw, hdfc bank did the same when a customer indicated that he'll transfer via cheque at no extra cost & yet burden their staff - bank removed the online charge...
Why don't we petition ICICI bank to roll back this charges.
ReplyDeleteHi Folks I have raised a petition for this http://www.petitiononline.com/RBIPET1/petition.html
ReplyDeleteCant guarantee if its 100% successful, but hope so.