Banks to levy Rs 150 after 4 cash transactions, Twitter users say not fair

This move being considered as a move to discourage cash transactions and encourage digital payments

Banks, including HDFC Bank, ICICI Bank and Axis Bank, from March 1 started imposing a minimum charge of Rs 150 per transaction for cash deposits and withdrawals beyond four free transactions in a month. The new charges would apply to savings as well as salary accounts. The bank would also cap the third party cash transactions at Rs 25,000 per day, while cash handling charges would be withdrawn.

This move by the banks is being considered as a move to discourage cash transactions and encourage digital payments.

What are the limitations?

People can withdraw or deposit up to Rs 2 lakh from their savings or salary accounts through the home branch for one month. Transaction exceeding this amount will be charged with Rs 5 per Rs 1000 or a minimum amount of Rs 150. 

Daily transaction in terms of non-home branches up to Rs 25,000 are non-chargeable. Senior citizens and children will not be charged any amount.

Cash transaction rules at different banks:

1. ICICI Bank: 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 subject to a minimum of Rs 150 in the same month. The third party limit would be Rs 50,000 per day. For non-home branches, ICICI Bank would not charge anything for first cash withdrawal of a calendar month and Rs 5 per thousand rupees thereafter subject to a minimum of Rs 150. In July 2016, ICICI Bank had imposed a similar charge on bank transactions. 

2. Axis Bank: At Axis Bank, the first five transactions or Rs 10 lakhs of cash deposits or withdrawals would be free and charged at Rs 5 per thousand rupees or Rs 150, whichever is higher. Up to five non-home branch transactions will be free, subject to a maximum per-day deposit of Rs 50,000. 

3. HDFC Bank: Customers will be charged Rs 150 per transaction, beyond the four free ones each month. The new charges would apply to savings as well as salary accounts.

We asked readers on Twitter whether they think the charges are justified or not. So far, out of 357 votes, 76% of the respondents say they are not.

You can also make your view on the matter count by participating in the Business Standard Twitter poll. Click here and submit your response

How social media reacted?

This move has received mixed reactions. Here’s how the netizens reacted: