After its demonetisation jolt, the rendra Modi government first called it a surgical strike against fake notes and black money, but later changed the discourse to explain the currency flushout as a massive push towards cashless (or rather, less cash) economy. With cash being forced into bank accounts and take the digital route for transactions, it was argued that tax evasion will henceforth be effectively dealt with, that taxmen can now follow suspicious money trails far better. How these claims stack up only the coming months will reveal, but many people are presently getting another shock as they go over their bank statements. They are waking up to the hard truth that ‘going cashless’ or ‘using plastic money’ has hidden costs. To be fair, banks did charge customers for using credit and debit cards and online payment facilities. But after the Prime Minister’s November 8 cash ban announcement, the Reserve Bank had exempted these charges to ease the pain. But after the demonetisation deadline passed on December 30 last, these charges are being brought back. The trouble is, there have been so many changes in bank rules in the last nearly four months, that bank customers can be forgiven if they feel like punch-drunk boxers failing to make head or tail of the happenings. Now many are confusedly discovering that some banks have steeply hiked cash transaction fees, ostensibly to wean them away from the cash habit. While the details vary for individual banks, broadly speaking, customers will be allowed only a certain number of free withdrawals and deposits a month, while they will be charged for non-fincial services like checking their balance status or applying for a cheque book. Even State Bank customers from April 1 this year will have to pay a pelty plus service tax if they don’t have minimum monthly average balance in their accounts, a practice SBI authority is re-introducing after five years.
Most consumers in Assam and other Northeast States lack in proper awareness about the products and services they buy, and bank customers are no exception. Had they the habit of reading the fine print, bank customers here would have had a far better idea about the services for which they are charged. They would have known that they actually pay for failure to maintain minimum balances, cheque bounce, transferring money online, getting bank statements beyond a limit, and even for visiting their branches or redeeming reward points for using Net banking and debit cards. Experts point out that such charges would keep growing year by year as banks mop up more revenues from ‘non-interest’ income. Post demonetization, since banks are going to be the heart of the much-hoped-for cashless economy, customers need to keep track of all such extra charges. This they can do by visiting their bank’s website, where all charges have to be mandatorily displayed as per RBI directive. But many consumer activists are aghast at different banks having different policies for ATM transactions. They are asking whether limiting the number of free cash transactions will merely force customers to withdraw more cash and keep it at home, which will only be a step backward. Beyond the prescribed limit, there is confusion as to which charge will be greater — withdrawing money by ATM or by physically visiting banks? Many people are finding out that if they swipe their cards at merchant establishments or petrol pumps, they can be charged extra by their bank. There has been much talk about encouraging card users to go for online transactions instead of cash payments, for which they are given reward points. But cases have been reported about people converting their reward points earned into cash with mobile apps, only to find to their chagrin that the charge deducted by the bank is greater! Overall, the entire cashless transaction system is becoming highly complicated due to the plethora of hidden bank charges. This in turn is posing a huge question about how the Prime Minister’s dream of ‘Digital India going cashless’ is shaping up in reality.