BEWARE! IT’S (NOT) FREE BANKING
On your TV screens we often see one add that the employee of bank listening patiently all the non-sense stuff of an old lady even though the banking operations are closed & all the employees goes home except him. You are right that’s ICICI Bank’s add, India’s largest private sector bank. It has a timeline saying, ‘Khayal Apaka’. Sate Bank of India (India’s largest bank) saying: ‘With you- all the way’, while IDBI Bank timeline: ‘Some relationships grow deeper with time’. In real sense the scenario is altogether different. The fact is that the do not even entertain their customers. Most of the customers feel like harassed.
In today’s world nothing is free; same is the case with banks. For every service you get you have to pay. Even entering a bank is costlier. The banks levy charges as ‘consultation charges.’
If you think that you haven’t tasted it, that’s false. You have tasted it unknowingly. Just go through your bank statement you will find various such charges have been levied by bank.
Last week when I was in bank for some official work, I saw my friend Akash quarreling with bankers. When I enquired about it I found that bank had debited his account with various charges like service charge, DD charges and many more.
Being a Financial & Tax consultant with curiosity I audited his bank passbook & bank statements. I found one such interesting charge that the bank has levied. This was the most illogical & stupid charge I have seen until now. It was ‘non transaction charge’ the bank had levied to his account by debiting Rs.50/-. Akash had not been using that bank account since from last 2 years.
This charge varies from bank to bank. SBI charges Rs.25/- if you have not withdrawn even a single penny from your account within 6 months. Another nationalized bank, Bank of Maharashtra charges Rs.50/- for same if no transaction have been done within 3 years.
The list of bank charges doesn’t end by 5-10 entries; it’s a 1-3 pages long.
Contradictory to above example SBI charges for excessive transaction done from your account. State Bank will charge Rs.5/- for each debit transaction in after you have crossed the limit of 30 debit transactions in 6 months, if done at a branch. Other banks like BANK OF MAHARASHTRA charge Rs.50/- if no transaction has been done from you’re a/c.
Its being a common complaint of ICICI Bank & HDFC Bank customers these bank levy hefty charges ranging from Rs.100/– 300/- for a duplicate statement. Although now you have freedom to withdraw money from another banks ATM not more than 5 times in a month. Some banks will charge Rs.12- 25.In case your transaction at other bank is rejected because you do not have the required balance then Kotak Mahindra Bank & ICIC Bank will charge Rs.25/- per transaction for certain types of saving A/c.
We often ask our clients/relatives to deposit money/cheque or to withdraw money near by bank branch closer to them. Bank levy charges for using non home branch, meaning a branch apart from where your account is registered. Kotak Mahindra bank will charge Rs.50-10000 on the basis of Rs.2.5 per Rs.10000 deposited or withdrawn at non home branches. HDFC bank levies a charge for third party transaction on your behalf for cash transaction at non home branches. ICICI Bank allows the first cash deposit in a non city branch per month free, but later Rs.5 per Rs. 1000 subject to minimum Rs.150/- will be levied. SBI charges Rs.25 per 10000 for non home transaction.
A mater of fact that most banks are trying to discourage its customers not to visit the bank branches. So its imperative to have internet banking and telephone banking.
IDBI BANK WAIVES CHARGES ON SAVING A/C
It has been rightly said that in this world nothing is free. But their is one exception, that is IDBI Bank has decided to waive all charges on various services for its current account & saving bank accounts(CASA) from September 01,2010.
The customers will now have to pay no charges for using ATMs of other banks, cheque book, demand draft; electronic fund transfers, ECS, account statements and others are also waived.
The other charges that have been removed from CASA customers relate to new card fee, new card issue, cash service, pay order, stop payment, account closure, demand draft issue and cancellation and standing instruction.
The reason behind waving of these charges is to increase low cost CASA deposit base by 20% from existing 13% in the nest 6 months.
So, enjoy FREE BANKING!
…… & NOW CREDIT CARD CRISIS IN AMERICA
Emergence of global financial meltdown was the effect of failure of the sub-prime mortgage and financial securities market. (Sub-prime borrowers were those that had less healthy loan repayment abilities.) The US is in deep financial trouble. The US credit card default rate have reached an all time high of 13% in March-10, and the total outstanding credit card debts per household which holds credit card debt, reached a staggering $16000 in the same month. The survey conducted by Fitch Ratings reveals that 98% of the total revolving debts in the US are made up of credit cards. Another astonishing fact was that 92 million of all US households hold one or more credit cards. Since 1970s fall in real wages of Americans have increased the usage of credit cards in the country. Americans mostly use the credit cards on housing, food, education, and health care. But with unemployment rates still hovering around 10% mark, default rates have increased over the past two years. Thereby catalyzing concerns that a chain reaction could pull the entire system down.
Credit card debt
• Average credit card debt per household with credit card debt: $15,788
• 76 percent of undergraduates have credit cards, and the average undergrad has $2,200 in credit card. Additionally, they will amass almost $20,000 in student debt. (Source: Nellie Mae, “Undergraduate Students and Credit Cards in 2004: An Analysis of Usage Rates and Trends”)
• Total U.S. consumer revolving debt fell to $866 billion at the end of 2009, down from $958 billion at the end of 2008. About 98 percent of that debt was credit card debt. (Source: Federal Reserve’s G.19 report, March 2010)
• The mean, or average, unpaid credit card balance last month was $3,389. The median is $90. (Source: “The Survey of Consumer Payment Choice,” Federal Reserve Bank of Boston, January 2010)
• About 45 percent of consumers said their unpaid credit card balance had gotten “lower” or “much lower” in the past 12 months. Only 26 percent said it had gotten “higher” or “much higher.”
HOW TO PAY TAXES ELECTRONICALLY? ITS 24X7
In today’s world you can almost buy anything on net by just a single click. So why not taxes? Yes, you can also pay taxes from anywhere in the world. In India almost all banks are providing online tax payment facility. The intention of this article is to create awareness about net banking facilities provided by various financial institutions. Despite of net banking facility and many other add-on services most of us are still using age old practices. Most of the banks will not accept your tax payment in cash. Banks will accept tax payments if they are paid through instrument or electronically. Cheque/ Online payment has been made mandatory by some of the laws like Income Tax Act, 1961 & Service Tax Act etc. You can also read my articles on my site http://www.mytaxform.info. Further we would discuss how to pay taxes online or electronically? For making online tax payment there is no need to download any software or purchase income tax challan. Any person having a net banking facility can pay taxes electronically. The detailed information can be obtained from the bankers as the procedure varies from bank to bank. The list of banks providing e tax payment facility is available on NSDL-TIN website.
How secure is the transaction?
There is no need to worry. All the transactions made through banks or NSDL-TIN or Income Tax site are encrypted and have Secure Socket Layer (SSL) authentication. Most of the banks in India have Verisign Digital Certification. This assures that this site is secured for financial transactions. Additionally, the security level will differ from bank to bank. If you don’t see the signs as mentioned above, you have to take extra measures for protection. Look for the closed padlock and “s” in https in the URL.
How to pay taxes online?
There are 2 ways by which one can pay taxes. (1) From NSDL-TIN website. (2) From your Bank site. 1) NSDL-TIN website/ Income Tax website: For paying from this site you can log on to http://www.onlineservices.tin.nsdl.com/etaxnews . Alternatively you can also pay through http://www.incometaxindia.gov.in. On Income Tax site there is ‘Pay your Tax Online” button on left hand menu bar. By clicking on this you will be redirected to NSDL-TIN website. The following steps will lead you in paying e-taxes.
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(payment of Income Tax & Corporation Tax) |
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(Tax Deducted at Source / Tax Collected at Source (TDS/TCS) from Corporates or non-corporates) |
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(payment of Security Transaction Tax, Hotel Receipts Tax, Estate Duty, Interest Tax, Wealth Tax, Expenditure Tax /Other Direct taxes & Gift tax) |
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(payment of Banking Cash Transaction Tax and Fringe Benefits Tax) |
• Select appropriate challan Form.
• After selecting appropriate challan, fill the details such as PAN, Name & address and then click on ‘Proceed’ button.
• A confirm data page will appear along with message in red letter. “For PAN ‘XXXXX 0000X’ given by you above, the name as per Income Tax Department database is ‘
XXXXXXXXX’.
Tax credit will be effected
to the said PAN nam
e. If the name is correct, then click on “Submit to the bank”
• Login with the user id and password and enter the tax amount along with any intrest or penalty.
• An e-receipt will be generated, save or print it for your record.
This is the complete e-payment process.
2). If you have to pay taxes through your bank directly then following steps should be taken:
• Login with user id and password.
• Click on E-Tax menu and select on appropriate type: Direct Tax, Indirect Tax or State Tax.
• Fill the appropriate challan along with tax am
ount.
• Click on Confirm button.
• An e-receipt will be generated containing CIN (Challan Identification Number).
Stop taking pains by wasting your time in standing long queue in banks and of carrying liquid cash, just clicking will pay your taxes. Pay your Taxes & have sound sleep