Only three public sector banks — State Bank of India, Indian Overseas Bank and Corporation Bank — levy charges on even the smallest money transfer done via mobile phones using the National Electronic Fund Transfer or NEFT facility, data compiled from public sector banks show.
None of the remaining 18 public sector banks have a policy of charging a fee for all NEFT transactions done via mobile apps.
A total of six public sector banks — including the above three — charge for all NEFT transactions when done using their websites. Besides SBI, IOB and Corporation Bank, the three public sector banks that charge for even the smallest NEFT transactions when done over their websites are Bank of India, Punjab & Sind Bank and Vijaya Bank.
NEFT used to be the most popular method to transfer money, but has in recent months been overshadowed by UPI or unified payments interface. Unlike NEFT — which is a bank-to-bank transfer and requires a clerk at the receiving end to credit the money to the payee’s account manually, UPI is an account-to-account payment and requires no manual intervention.
As a result, payments done via UPI are instantaneous, while NEFT takes a few hours to be completed. Besides, UPI is available at all times, while NEFT is available only at working hours.
Banks that do not charge for small transactions on NEFT — whether carried out on their apps or their websites — are Allahabad Bank, Andhra Bank, Bank of Baroda, Bank of Maharashtra, Central Bank of India, Canara Bank, Dena Bank, IDBI Bank, Indian Bank, Oriental Bank of Commerce, Punjab National Bank, Syndicate Bank, UCO Bank, Union Bank of India and United Bank.
Andhra Bank used to charge at least Rs 2.5 per transaction for NEFT, but removed the fee in the aftermath of demonetization of 500- and 1000-rupee notes.
The country’s largest bank, State Bank of India, also cut its charge from Rs 2 for transactions up to Rs 1,000 to Rs 1, and from Rs 20 for transactions above Rs 2 lakh to Rs 5.
Private sector banks such as Axis Bank and ICICI Bank also charge for NEFT.
