Government to pay banks transaction fee

With the intention of attracting banks more in the Aadhaar based Direct Cash Transfer implementation, the government has decided to offer banks transaction fee to ensure that the desired services are accessed even by the people from the rural India. A setup will be introduced soon to pay the banks a transaction fee for all the services involved in the cash transfer implementation.

The fee will be different for different debit and credit from the bank and the government is thinking to pay the bank 3.14% of the amount of transaction plus Rs. 20 per transaction. An official was reported to say that there will be a cost to bank in each transaction. He added that the banks may not get much profits of it as the money involved will be very low and the account holder will debit out the  money as soon as he gets it credited into his/her account. All this entire process includes expenses and the government has to make some point in this as well. Recently a task force in the beginning of 2012 reported that @ 3.14% per transaction, the sum could reach to Rs. 5k core when the DCT scheme is fully implemented.

Presently, banks handle all the costs involved in the current process of transactions. The authorities have said that in the DCT scheme, the government will take care of the bank’s interest so that the implementation can witness maximum participation from the banks. The DCT scheme is expected to be launched on 1st January, however, payment of transaction fee may take some time to come into effect.

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