SBI Card has apparently taken the digitization drive in India quite seriously. Being the arm of State Bank of India, SBI Card announced it’s new decision to charge Rs 100 for every cheque transaction below Rs 2,000.
SBI Card MD and CEO Vijay Jasuja said, “A large number of cheques were being dropped late into the boxes and subsequently disputes were raised on late payment charges. We have done a deep analysis. It is not possible that every month the bank is making a mistake in cheque collection.”
SBI Card is not a bank but a finance company which issues plastic cards, cheques and allot other facilities. Hence, it paid a cost of collecting and depositing cheques.
Impressively, SBI Card boasts of 14 modes of bill payments. However, due to the digitization drive, most of these modes involve internet usage. Hence, for those people who are uncomfortable with using internet for bank payments, they resort to cheque mode of transaction.
Notably, the prescribed fees will not apply on Intrabank payments for which cheque has been submitted across the counter. This means that if a SBI customer intends to pay a sum to another SBI customer, no fees shall apply. Fee charges shall only apply if non-SBI cheques are dropped for clearance.
If you think digitization is being forceful, then the bank has too many offers to incentivize you towards using digital modes of payment. Those paying online are being granted reward points which have instigated many people to switch their payment modes from physical to digital.
According to Jasuja, 92% of cardholders are settling their bills through non-cheque mode.
“Of the 8% who are paying by cheque, around 6% have bills of over Rs 2,000 and it is only the remaining 2% who are getting affected,” Jasuja said.
“We are only looking at recovering that clearing cost. When we are talking about digitisation and all modes are available, what is the need of paying by cheque?,” Jasuja questioned.