What changed
RBI, referencing the Damodaran Committee recommendations and the May 2013 Monetary Policy Statement, has mandated that RRBs must not discriminate between home and non-home branches on intersol charges. If a service is free at the home branch, it must be free at all branches. Cash handling charges are explicitly excluded from intersol charges.
What it means for you
RRBs must now treat all customers equally across branches under CBS, eliminating the practice of charging extra for services at non-home branches. This levels the playing field for customers and reduces revenue from such fees for banks. Banks need to review and align their fee structures to ensure uniform pricing, which may impact profitability from intersol charges.
What you must do
- Review your current intersol charge structure and ensure uniform pricing across all branches for the same services.
- Update internal policies and system configurations to remove any home/non-home branch discrimination in fee application.
- Communicate the revised uniform pricing policy to all branches and customer-facing staff to ensure compliance.
- Exclude cash handling charges from intersol charges and treat them separately as per RBI clarification.
Who it affects
Regional Rural Banks (RRBs), RRB customers using CBS services across multiple branches, RRB branch managers and operations teams
What are intersol charges?
Intersol charges are fees levied by banks to cover the cost of providing services to customers through the Core Banking Solution (CBS) platform. They are meant to be branch-agnostic.
Does this circular apply to cash handling charges?
No, RBI has clarified that cash handling charges are not included under intersol charges and are not subject to this uniformity requirement.
What happens if my RRB currently charges different fees at home and non-home branches?
You must immediately align your fee structure to ensure the same service is priced identically at all branches. If a service is free at the home branch, it must be free everywhere.