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Did you know that your bank is debiting money from your account for providing SMS alerts? If you didn't, it's time you checked the last bank statement or the passbook.
Banks, led by State Bank of India, ICICI Bank and Axis Bank, are charging Rs 60 annually to send text messages about cash withdrawals and other facilities. Others such as Canara Bank are charging more than Rs 100, while HDFC Bank said they were levying a Rs 60 fee only for "special alerts" such as bounced cheques, salary credits or the balance going below a specified level. Besides, the service was optional, it said. IDBI Bank and Vijaya Bank have excluded savings bank accounts from the paid SMS alert service.
Finance minister P Chidambaram told Parliament on Friday that there were five public sector banks that were charging for SMS alerts. But enquiries by TOI showed that it isn't just the state-run players, even private banks such as ICICI and HDFC were charging customers.
While most banks have shifted to a paid SMS alert system only this year, others like IDBI and Vijaya Bank passed on the cost to customers as far back as 2010-11. In fact, the finance minister told Parliament that in 2010-11, IDBI Bank collected more than Rs 1 crore through SMS alerts, while Vijaya Bank received nearly Rs 30 lakh last fiscal.
In March 2011, the Reserve Bank of India had asked banks to send online alerts to customers for all transactions, but left it to banks whether or not to charge for it. Chidambaram said the government was not considering a proposal to withdraw the charge.
An executive at a private sector lender said his bank began charging for SMS alerts as mobile operators raised the fee for bulk message from 2 paise per SMS to 20 paise, making a free service "unviable". Banks said they had sent out a message saying that the service would be charged but most consumers either ignored the SMS or did not respond — which was seen as a yes to being charged for alerts.
Source: EconomicTimes
Banks, led by State Bank of India, ICICI Bank and Axis Bank, are charging Rs 60 annually to send text messages about cash withdrawals and other facilities. Others such as Canara Bank are charging more than Rs 100, while HDFC Bank said they were levying a Rs 60 fee only for "special alerts" such as bounced cheques, salary credits or the balance going below a specified level. Besides, the service was optional, it said. IDBI Bank and Vijaya Bank have excluded savings bank accounts from the paid SMS alert service.
Finance minister P Chidambaram told Parliament on Friday that there were five public sector banks that were charging for SMS alerts. But enquiries by TOI showed that it isn't just the state-run players, even private banks such as ICICI and HDFC were charging customers.
While most banks have shifted to a paid SMS alert system only this year, others like IDBI and Vijaya Bank passed on the cost to customers as far back as 2010-11. In fact, the finance minister told Parliament that in 2010-11, IDBI Bank collected more than Rs 1 crore through SMS alerts, while Vijaya Bank received nearly Rs 30 lakh last fiscal.
In March 2011, the Reserve Bank of India had asked banks to send online alerts to customers for all transactions, but left it to banks whether or not to charge for it. Chidambaram said the government was not considering a proposal to withdraw the charge.
An executive at a private sector lender said his bank began charging for SMS alerts as mobile operators raised the fee for bulk message from 2 paise per SMS to 20 paise, making a free service "unviable". Banks said they had sent out a message saying that the service would be charged but most consumers either ignored the SMS or did not respond — which was seen as a yes to being charged for alerts.
Source: EconomicTimes
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