Private Sector Banks to impose Cash Transaction Fees

Recently, from 01 March 2017, Wednesday onward, all major private sector banks like ICICI Bank, HDFC Bank and Axis Bank have started charging a fee of Rs.150 (minimum) for transactions including both cash withdrawals and deposits beyond first four free transactions every month. This step has been taken to encourage digital payments drive initiated by the Modi government.

These charges will be imposed on both Savings and Salary Savings Accounts with effect from Wednesday, mentioned in a circular by HDFC Bank.

These banks have also capped the 3rd party cash transactions at Rs.25000/- per day. However cash managing charges will be withdrawn from 01 March 2017.

The only relief given is that first four transactions will be free every month for withdrawing the cash whereas depositing will levy no charges.

The circular from ICICI Bank mentioned that after the first four transactions in a month within a home branch, a fee of minimum Rs.150/- will be charged furthering charges to Rs.5 per thousand rupees. For non-home branches, only first cash withdrawal will be free, thereafter Rs.5 per thousand rupees subjected to Rs.150/- as minimum pay-off.

Axis Bank has made first five transactions or a cash deposit or withdrawal of an amount of Rs.10 lacs absolutely free of cost and thereafter Rs.5 per thousand or Rs.150/- whichever is higher will be charged.

Public sector banks have not given any hint of imposing any cash transaction charges.

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