Skip to main content

RBI "appeases" tech savvy upper class, refuses to remove big penalties affecting poor

Counterview Desk
Even as welcoming Reserve Bank of India's decision to remove RGTS and NEFT transactions the Financial Accountability Network India (FAN India) – a group of civil societies, unions, NGOs and peoples movements – has said that it merely seeks to boost digitalisation and is yet another indicator that the RBI is interested in promoting banking among only a particular class (tech-savvy, urban, middle and upper-middle class).
In a statement, FAN India has said, RBI has ignored the interests of the weaker sections of society, which are affected most due to higher charges on basic services, pointing out that a pilot study conducted by RBI in Mumbai has revealed that over than 25% of the customers are "unhappy with the charges such as penalty on non-maintenance of minimum balance, cash deposit charges at home and non-home branches, cheque return charges (deposited by the customers) and for signature verification."

Text of the statement:

The Financial Accountability Network India (FAN India) welcomes the Reserve Bank of India’s (RBI's) decision to remove charges for the Real Time Gross Settlement (RTGS) and National Electronic Fund Transfer (NEFT) transactions and to form a committee under the chairmanship of Chief Executive Officer, Indian Banks’ Association, to ‘examine the entire gamut of ATM charges and fees.’
As a group of civil societies, unions, NGOs and peoples movements, it has been our longstanding demand from the RBI and the government that it look into the matter of bank charges and take immediate actions to remove all the charges.
While the RBI’s decision on removal of the charges on NEFT and RTGS and setting up a Committee is appreciated, it is important to note here that the RBI has so far stated that all charges levied by the banks are at the discretion of respective banks and that the RBI will not step in. It is a welcome step that the central bank has now recognised the problem of charges levied by banks for providing various services.
We demand that the Committee, that is being set up under the chairmanship of Chief Executive Officer, Indian Banks’ Association, will engage with all the stakeholders, including the affected public, and remove the cap on free transactions from ATMs. We also demand that the RBI does not deal with the charges in piecemeal but scraps all bank charges.
The current decision to ‘boost digitalisation’ is yet another indicator that the RBI is interested in promoting banking among only a particular class (tech-savvy, urban, middle and upper-middle class) while ignoring the interests of the weaker sections of society, which are affected most due to higher charges on basic services.
For instance, the charges for NEFT and RTGS varies from Rs 1 to Rs 5 and Rs 5 to Rs 50 (GST excluded) respectively. These are negligible if one compares them with other charges like a penalty for not the maintaining minimum balance, which varies from Rs 10 to Rs 600, and charges on cash transactions, ranging from Rs 10 to Rs 160, done at bank branches.
Recently, a pilot study conducted by RBI in Mumbai revealed that over than 25 per cent of the customers are unhappy with the charges such as penalty on non-maintenance of minimum balance, cash deposit charges at home and non-home branches, cheque return charges (deposited by the customers) and for signature verification.
These charges have also become an impediment in implementing various welfare schemes being run by the government. Just last week, the Maharashtra government has blamed banks for applying various charges on beneficiaries’ accounts, which is making it difficult for beneficiaries to access the money.
On the one hand, banks are increasing charges levied for providing for banking services for common people to compensate for their losses created by massive non-performing assets, thus hurting mostly the weaker sections of society. And on the other, they are allowing free transactions for online users, again neglecting people still dependent on brick and mortar bank branches for their banking activities.
Moreover, this development has to be seen in the broader context of banking reforms that the current government is planning. The push for digitalisation and putting charges on transactions done at banks will push the people away from brick and mortar banks and will make way for reducing the bank branches, the merger of banks, and consequently reducing the number of bank employees.
Our campaign "No Bank Charges” has witnessed hundreds of people sending postcards and emails to the RBI governor, the Finance Minister, and the Prime Minister demanding to scrap all the bank charges.
Our demands:
  • The committee on ATM charges should be open for consultations and remove the cap on transactions as well as the charges. 
  • RBI does not deal with the charges in piecemeal but scraps all bank charges.
The Financial Accountability Network India (FAN India) – a group of civil societies, unions, NGOs and peoples movements – demands from the RBI and the government that it looks into the matter of bank charges on banking services and take immediate actions to remove all the charges which act against the interest of the people.

Comments

TRENDING

Astonishingly sycophantic: Ex-Gujarat topcop on 2002 Godhra riots probe panel report

By Rajiv Shah  In a scathing critique of the 2002 communal riots inquiry commission report, released by the Gujarat government in December 2019 five years after it was submitted, the State’s former topcop RB Sreekumar has said that it “unequivocally” and “meticulously” takes care “to refrain from probing and taking cognizance of any deviant action of omission and commission by the State administration, particularly those operating in the criminal justice system, who facilitated extensive mass violence and enabled brigands to perpetrate anti-minority crimes.”

Swami Vivekananda's views on caste and sexuality were 'painfully' regressive

By Bhaskar Sur* Swami Vivekananda now belongs more to the modern Hindu mythology than reality. It makes a daunting job to discover the real human being who knew unemployment, humiliation of losing a teaching job for 'incompetence', longed in vain for the bliss of a happy conjugal life only to suffer the consequent frustration.

Two of 12 top caste-based sexual violence cases from 'model' Gujarat: NGO report

By Rajiv Shah   The National Council of Women Leaders (NCWL), a civil rights group, has compiled what it has called “landmark cases of caste-based sexual violence” between 1985 and 2020 to mark the first anniversary of the notorious Hathras gangrape case, which led to the death of a young Dalit woman in September 2020.

Riddled with Brahmanical mindset, India's health care 'serving' corporate interests

By Vidya Bhushan Rawat*  In this second part of my conversation (click here for first part), Dr Manisha Bangar speaks about the health crisis in India how the government is trying to privatise things, and where our response during the Corona period was lacking. She also gives us an understanding of people opposing nutritious meals for children in the mid-day meal.

Buddhist shrines were 'massively destroyed' by Brahmanical rulers: Historian DN Jha

Nalanda mahavihara By Our Representative Prominent historian DN Jha, an expert in India's ancient and medieval past, in his new book , "Against the Grain: Notes on Identity, Intolerance and History", in a sharp critique of "Hindutva ideologues", who look at the ancient period of Indian history as "a golden age marked by social harmony, devoid of any religious violence", has said, "Demolition and desecration of rival religious establishments, and the appropriation of their idols, was not uncommon in India before the advent of Islam".

Ram ke naam? Upper caste Hindus 'created' the demand for temple in Ayodhya

By Sahil Mital*  Documentary filmmaker Anand Patwardhan brought an important issue to the forefront with ‘Ram ke Naam’ (In the Name of God). At a time when religious fundamentalism and fanaticism is on the rise, this movie brings to light the reality behind the thought process of people involved, both inside and outside such issues.

Hard times? Seeking to promote Urdu amidst 'efforts' to brand it as language of Muslims

By Firoz Bakht Ahmed*  Those who believe that Urdu is a dying language, must come to the National Council for Promotion of Urdu Language (NCPUL), spend some time here and see that Urdu, like any other language, is on a fast track. For the connoisseurs of Urdu, it is a heaven!

Power supply lines in Thar 'pushing' Great Indian Bustard to extinction: Researchers

By Rosamma Thomas*  Electricity supply lines pose a huge risk to birds and affect biodiversity, but there is little research about the numbers of birds dying of such collision in the tropical nations. In August 2021, academic journal Biological Conservation carried the results of a survey conducted in 2017-18 on 4,200 sq km of the Thar Desert in Jaisalmer district of Rajasthan. This was the first comprehensive survey of this nature in the region.

Bahujan patriarchy? Savarna feminists 'over-state' gender rights in Dalit communities

By Vidya Bhushan Rawat*  Dr Manisha Bangar is a practicing senior consultant gastroenterologist and transplant hepatologist, with around 20 years of clinica-cum-research and teaching experience. In terms of her medical qualification, she completed MBBS, MD and DM. She was a governing council member of the Indian National Association for Study of the Liver (INASL), and member of the Task Force for Hepatitis B and Non-Alcoholic SteatoHepatitis (NASH) diseases of the South Asian Association for Study of the Liver (SAASL).

Vindictive raids? Centre 'retaliates' after Delhi govt child rights body's clean chit to ex-babu

By Our Representative  Over 700 academics, advocates, activists, civil servants, writers, film makers, journalists, musicians and artists have condemned the raids by the Enforcement Directorate (ED) on the offices and private home of top IAS bureaucrat-turned-human rights and peace activist Harsh Mander, stating, the aim is nothing but to “harass and intimidate” him.