Published On : Wed, Mar 8th, 2017

Charges by Banks on various services should also be regulated by RBI – VTA

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Vidarbha Taxpayers Association (VTA) is aware that Reserve Bank of India (RBI) regulates financial system and monitory policy in our country by deriving its regulatory powers for Indian Banking System from the provisions of the Banking Regulation Act 1949 and for other entities; it derives power from the RBI Act 1934.

And as the nation’s financial regulator, the Reserve Bank handles a range of activities, like Licensing, prescribing capital requirements, monitoring governance, setting prudential regulations to ensure solvency and liquidity of the banks, prescribing lending to certain priority sectors of the economy, regulating interest rates in specific areas, setting appropriate regulatory norms related to income recognition, asset classification, provisioning, investment valuation, exposure limits and like initiating new regulation.

However recently taxpayers observed that various banks have started charging it customers for their basic fundamental duties, including handling of cash like withdrawal and deposit too, although initially for few transactions there is no charge, however after the limit is over, they charge.

Taking this situation in public interest VTA dispatched memorandum to Narendra Modi – Prime Minister, Arun Jaitley – Union Finance Minister and Urjit Patel – RBI Governor with request to bring such charges to under the regulation of RBI so that some control remains in the hands of the Authority.

J. P. Sharma, president of VTA said that the most worrisome part of this situation is that the customer is absolutely unaware of such charges being debited to his account, its only after the bank statement is reconciled the client gets to know about the total amount levied by the bank. There numerous small and medium traders / retailers sell products in cash including cinema halls, petrol pumps and likewise needs to deposit their cash almost daily and if such charges is levied by banks on them, it becomes absolutely illogical and illegitimate. Maintaining minimum balance by a minimum wages or similar salaried personal is impossible.

Tejinder Singh Renu, secretary of VTA said that although such policy by Banks may be supporting ‘Less Cash Policy’ of the Government; however it should not violate Constitutional Right of the Citizens as per Article 19(1)(g) to practice any profession, or to carry on any occupation, trade or business by causing such unpractical hurdles.

Renu said, banks needs to focus on their Non Performing Assets (NPAs) as those loans cause dent in Bank’s profits and in order to reduce their red, bank charge such honest taxpayers for little services which is surely impractical and dishonest. This is a public interest issue as practically every citizen is affected by such charges and if not regulated now, banks have monopolistic advantage of the same and can become issue of great concern if not regulated in time.

Vidarbha Taxpayers Association strongly believes and suggests that RBI along with other governance on banks should also regulate charges being levied by them on various services which Banks provide in regular course. Account Holders are never informed about the charges they debit to the respective clients, although traders and businessmen get to know about the same while preparing their accounts, but what about senior citizens, retired personals, small traders and retailers; for them such charges are by all means are absolutely immoral.