If queries at the senior-most level of banks and regulators led to such confusing answers, what is an ordinary customer to do? Every customer who chooses not to contest wrong charges saying they are insignificant (most customers don’t) adds to the bank’s bottomline because it turns into a tidy sum when spread across thousands of branches and millions of customers.

While chasing Garg’s Rs 40 problem we also discovered that not charging for electronic credits might not last forever. The RBI has waived processing charges for NEFT transactions until March 31, 2007 and left service charges to the discretion of respective banks. Four months down the line, if RBI decides to charge processing fees, banks may pass the burden on to customers causing other problems.

After minimum lots for holding shares were scrapped, several investors own single shares of companies. In these cases, bank charges could eat up a significant chunk of the dividend without giving the investor an option to seek alternative modes of payment. Imagine how ridiculous it would be if the dividend received is lower than bank charges.

Clearly, RBI cannot leave all service charge decisions to the discretion of banks; it must think through the issue, especially if it plans to charge banks for NEFT transactions after March next. Welcome to the new world of endless new costs and service charges that quietly eat up significant chunks of the post tax income of ordinary taxpayers. The problem starts right at the very top with a government that is so focused on finding new ways to gouge tax to fund billowing expenditure, that it refuses to consider the overall impact of all these taxes, fees, tolls, surcharges and user charges that are being forked out in addition to all the municipal, state and union government levies.

... contd.