Come 2020, your National Electronic Funds Transfer (NEFT) transactions will be free of cost. The Reserve Bank of India (RBI) has a gift for savings bank account holders. To promote digital transactions, RBI has directed banks not to charge savings account holders for NEFT with effect from 1st January 2020. “In order to give further impetus to digital retail payments, it has now been decided that member banks shall not levy any charges from their savings bank account holders for funds transfers done through NEFT system which are initiated online (viz. internet banking and/or mobile apps of the banks). This directive is issued under Section 10 (2) read with Section 18 of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007) and shall be effective from January 1, 2020.” RBI had said in a notification dated 16 December.
RBI recently announced that NEFT money transfer has now become 24X7 facility, which means you can transfer money round-the-clock. Now, this facility is also available during bank holidays. This will be extremely beneficial for large-value transactions which cannot be done through UPI or mmediate Payment Service (IMPS). The eventual waiver of charges will benefit small traders as well. NEFT money transfer timings were fixed from 8 am to 6.30 pm on working days, however NEFT money transfer facility was not available during holidays.
What is National Electronic Funds Transfer (NEFT)
The National Electronic Funds Transfer (NEFT) is an electronic funds transfer system maintained by the RBI, to transfer funds from one bank account to another. Money transfer can be made by an individual or company to an individual or company’s bank account with any bank that is a member of the NEFT scheme, according to the RBI .
Currently, some banks like State Bank of India (SBI) and ICICI Bank had made online NEFT transfers free.
RBI in its July monetary policy review meeting had announced its decision to do away with the charges levied for NEFT and RTGS transactions.