SBI yet to refund Rs 164 crore charged as UPI fees before 2020 to Jan Dhan accounts

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SBI yet to refund Rs 164 crore charged as UPI fees before 2020 to Jan Dhan accounts:

State Bank of India (SBI) is yet to refund an estimated Rs 164 crore charged to PM Jan Dhan Yojana (JDY) account holders for transactions between April 2017 and December 2019. During this period, customers were charged Rs 17.7 per transaction for digital payments using the Unified Payments Interface (UPI) and RuPay PMJDY debit cards. The practice was subsequently discontinued and the bank had refunded Rs 90 crore towards charges between January and September last year, but it continues to hold on to the fees made from earlier transactions.

According to a report on the charges prepared by Ashish Das, a professor at IIT-Bombay, who had earlier highlighted these fees in another report, SBI imposed Rs 17.70 per transaction during June 2017 through December 2019 and of Rs 5.90 per transaction for April-May 2017.

“During the 33 months April 2017 through December 2019, SBI collected anywhere between Rs 164 crore and Rs 177 crore towards charges imposed on at least 9 crore UPI and RuPay debit card digital transactions done by BSBDA (basic savings bank deposit account) customers. SBI has still not refunded this amount of over Rs 164 crore that has been improperly collected through the imposition of usurious charges on the BSBDA customers,” said Das.

“There could be an operational difficulty for refund, but it has been demonstrated that it can be done. SBI has already done a refund for transactions during the six-month period ending September 2020,” said Das. He added that these charges were imposed on the JDY account, which was meant for the most vulnerable members of society and to be free of all charges.

According to a banker, the JDY accounts are not as unprofitable as they used to be as the minimum balances in these accounts have gone up. Also, banks are servicing most of these accounts through business correspondents (BCs) to keep the costs low. Banks pay BCs a fee for every transaction they enable but the same is not passed on to the customer. While outsourcing does reduce costs for banks, lenders said that there have been instances where agents of BCs in connivance with customers round-tripped transactions and withdrew the same funds multiple times to increase fees.

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