(Image Courtesy: mid-day.com)

Depositing your money in the bank was always considered a brilliant way to save cash. But, in a recent turn of announcements from some private banks, it seems that free withdrawal days are over and things are about to change. With effect from 1st March 2017, HDFC bank, ICICI bank and Axis Bank have started levying a minimum charge of Rs 150 per transaction for cash deposits and withdrawals beyond four free transactions per month.

HDFC BANK RULES

These charges will apply to savings as well as salary accounts, stated HDFC bank in a circular. HDFC bank also stated that according to their new rule, not only will the customers have to pay Rs 150 per transaction after four free ones, but they will also have to pay cess and additional service tax. The third party limit for cash transactions has also been set, where the third party can’t carry out a transaction of more than Rs 25,000. A transaction of Rs 25,000 can be done with Rs 150 as charge. Although on the brighter side, cash handling charges which came into effect after demonetisation will be withdrawn starting from today.

The bank did provide some sanguinity to its customers by stating that a transaction of Rs 25,000 from a non-home branch won’t even cost a rupee, but anything above Rs 25,000 will be charged Rs 5 per thousand or a minimal amount of Rs 150 once and for all. The tax and cess will be applicable on this amount as well. At a home branch, if the cumulative cash (deposit and withdrawal) exceeds Rs 2 lakh, a transaction charge of Rs 5 per thousand rupees or Rs 150 (plus tax and cess) will be levied. HDFC did provide some relief to its minor and senior citizens by saying that there will be no charge or tax for them upto an amount of Rs. 25,000 per day.

RULES STATED BY AXIS BANK AND ICICI BANK

Axis Bank also issues a statement on new rules introduced by the bank. The first five transactions or Rs 10 lakh of cash deposits or withdrawals would be free and charged at Rs 5 per thousand rupees or Rs 150, whichever is higher.

Many banks including ICICI Bank and Axis Bank had already levied charges with effect from early January and are still the same as they were before demonetisation was announced, while there is an increase in the fees in case of some other banks like HDFC Bank, starting from today.

ICICI Bank website quoted that, there will be no charge for first four transactions a month at branches in home city while Rs 5 per thousand rupees would be charged thereafter subjected to a minimum of Rs 150 in the same month. The third party limit was decided to be Rs 50,000 per day. For non-home branches, ICICI Bank would not charge anything for first cash withdrawal and Rs 5 per thousand rupees will be charged thereafter subjected to a minimum of Rs 150.
In the case of cash deposits anywhere, ICICI Bank would charge Rs 5 per thousand rupees (subject to a minimum of 150) at branches, while deposit at Cash Acceptance Machine would be free of charge for first cash deposit and Rs 5 per thousand thereafter. These charges are for cash transactions in the branches, and not through ATMs.
Speculations are still rife about the fact that whether public sector banks have also levied such charges or not. A senior bank official also stated that there has been no directive from the government to the bank with respect to the charges levied.
This move of increasing cash withdrawal and deposit amount has been introduced to promote the initiative of a cashless India, and to encourage people to use digitization for money matters rather than dealing with cash. What remains to be seen is whether this decision can achieve its aim and prove to be boon to the masses in the long run.

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