- RBI announced some changes in the banking rules in the country.
- The latest modifications in the banking system will take effect in January 2020.
- Here are the important changes you need to know regarding financial transactions, EPF, Insurance, Hallmark, FASTag and Aadhaar linking in India.
Here are the latest guidelines and changes that take effect in January 2020.
NEFT charges will be rolled back
As per the new RBI guidelines, banks must stop charging customers a fee for transacting using the NEFT (National Electronic Funds Transfer) system. This measure is intended to encourage digital transactions among the users. Statistics show digital payments accounted for over 96% of the total non-cash retail payments done from October, 2018 to September 2019.
OTP to withdraw cash from ATM
India’s largest bank SBI says the customers transacting on the ATMs from January 2020 will have to input an OTP sent by the bank on their registered mobile phones to complete the transaction. It means users will have to carry their mobile phones while using ATMs. This measure is implemented to prevent fraudulent transactions and enhance the security measures while using ATMs.
No MDR charges for transactions on RuPay and UPI platforms
The Department of Revenue is to announce RuPay and UPI as the prescribed mode for paying while transacting digitally. The finance minister Nirmala Sitaraman said there will not be any MDR (Merchant Discount Rate) charges while using these platforms for transactions.
You can choose to lower your EPF contribution
With the bill successfully passed in the Parliament, the government has decided to let employees lower their EPF contribution if they choose to. About 12% of their basic is deducted at present from the salaries of the employees for depositing in EPF. The said revision in the rule enables employees take more salary to their homes, if they want.
General insurance policy premiums will cost more
The New Year might also see general insurance premiums go up by 10 to 15% on account of the rise in reinsurance rates. Reinsurance rate is the rate that the insurance providers must pay for securing a cover. The rise in reinsurance costs will mean the premiums will cost more. Health insurance providers who are under the pressure to cover additional ailments, are looking forward to increase the health insurance premiums from 10 to 15% in 2020.
SBI loan interest rates will come down
After the RBI reviewed its monetary policy in December, SBI became the first bank to cut its external benchmark rate by 25 basis points. While the revised benchmark lending rate of 7.8% is taking effect from 1 January 2020, the borrowers will see the home loan interest rates come down to 7.9% a year from the previous 8.15%. The interests of other kinds of loans will also come down a bit in the New Year.
Hallmarking becomes mandatory for jewelry
From January 15, 2020, the government has said hallmarking is mandatory on jewelry. Nevertheless, the government has allowed a lean period of one year to ensure compliance with this new rule giving time for establishing new hallmarking centers across the country and also to clear existing jewelry stocks with the merchants. This move is expected to tackle the quality concerns and thereby boost demand for gold in India which is the second largest gold market of the world.
3 months extension given to link Aadhaar with PAN card
The government’s latest announcement on the subject says the last date to link Aadhaar card with PAN card is extended for three more months from December 31, 2019 to March 31, 2020. This is the second time that the government is extending this deadline so that the users are given enough time to complete the task. While the Income Tax laws say that the PAN cards will become inactive if Aadhaar card is not linked, the extension comes as a respite to those who have not linked these two documents.
Those that have not purchased FASTag will have to pay two times the toll charges
All private and commercial vehicles running on the Indian roads must purchase FASTags. The government earlier extended the December 1, 2019 deadline to December 15, 2019 for the vehicle owners to ensure compliance. Failing to do so and driving through the toll lanes without FASTag affixed to your car windshield, will mean you will be paying twice the toll charge. These are rechargeable tags that will enable automatic deduction of toll charges from your linked bank account as you can avoid long queues at the toll plazas.
SBI’s chip debit cards will only work in the New Year 2020
SBI had earlier asked its customers to change their magnetic stripe debit cards with EMV chip and PIN-based SBI debits cards. This can be done at their home branch. If you are an SBI customer having your old magnetic stripe card, your card will not work from January 1, 2020. In a statement, SBI has said, “Apply now to change your Magnetic Stripe Debit Cards to the more secure EMV Chip and PIN-based SBI Debit card at your home branch by 31st December, 2019. Safeguard yourself with guaranteed authenticity, greater security for online payments and added security against fraud.”