If the Reserve Bank of India (RBI) has its way, bank customers will need to shell out a substantially lower amount as service charges for encashing their outstation cheques. The RBI move is part of its plan to rationalise and bring in uniformity in the mode and amount of service charges for electronic payment products and outstation cheque collection by banks.

“The benefit of waiver of charges offered by RBI should get passed on to customers to the extent possible. The endeavour should be to migrate to electronic modes of payment, more so for large-value and inter-city transactions,” it said.

The RBI has proposed that for cheque values up to Rs 10,000, service charges should not be more than Rs 25 as against the current average of Rs 42 being charged by banks. For cheques between Rs 10,000 to Rs 1 lakh, the charge should not be more than Rs 50 as against the current average of 0.4 per cent of the value. This means for an outstation cheque worth Rs one lakh, the service charge will come down from Rs 400 to Rs 50. For cheques valued Rs 1 lakh and above, the charge will be Rs 100 as against 0.4 per cent now. This means for an outstation cheque valued at Rs one crore, the service charge will come down from Rs 40,000 to just Rs 100.

“These charges will be all inclusive. No additional charges such as courier charges, out of pocket expenses, etc., should be levied to the customers. No bank should refuse to offer the products to its customers or decline to accept outstation cheques deposited by its customers for collection,” the RBI said in its approach paper on service charges levied by banks. According to an RBI study, there’s no uniformity either in the amount or basis for levy of charges by banks now. “While some banks levy based on the number of transactions, some others go by the amount to be transferred. Some banks charge multiple slabs based on amount, with a base minimum stipulation. Quite a few banks have different charges for local and outstation transactions,” it said. The RBI said none of the banks charge for inward NEFT/ECS transactions. However, charges for inward RTGS are being levied by some banks. Destination banks also charge a lump sum amount. It said RBI offers electronic products free of charge to member banks. “Multiplicity of slabs levied by banks and lack of transparency in norms adopted by them for various segments of customers has led to confusion,” it said.