NEFT charges

Great news. ICICI Bank will now charge Rs.5 per transaction for electronic funds transfer. Time to shift money and salary accounts from ICICI Bank?

5 bucks may not be much on both absolute and relative terms for most of us. But I fail to understand why I would pay anything at all to transfer my own money from the bank. I do it online because it is convenient and I can schedule automatic transfers on certain days of the month. I can, at a pinch, simply issue cheques for the few transfers I  make.

I can understand that some people may be transferring a rupee a day to hundreds of accounts and this costs the bank money. And the bank is well within its rights to levy a charge; after all the RBI allows banks to charge upto 5 bucks per transaction. But it could very well have levied this charge on those who have too many transactions. Leaving the first, say, 10 transactions in a month would probably have kept several people like me happy.

I've seen this happen with other banks too. Levying charges for drafts, money transfers, cheques... I have a simple solution - just use the services which don't cost money and use another bank for the rest. A certain amount of cheques per month are free, that's sufficient to distribute funds to accounts in other banks.

Wonder if the interest lost due to my shifting funds to other banks because of these stupid policies is really less than what they would have earned by their service charges...

As an aside, the NEFT service charge also includes service tax. I am certainly not going to pay money to the guv'mint for moving my funds to another of my own accounts!