What changed
RBI has clarified that the service charges of ₹5 and ₹8 per packet for cash handling by non-chest branches at currency chests are exclusive of GST. This means banks must now add applicable taxes on top of these base charges, as per earlier circulars from 2016 and 2019.
What it means for you
Banks with currency chests must revise their billing to include GST on service charges for non-chest branch cash deposits. This ensures compliance with tax laws and avoids disputes over charge amounts. Lenders should update their fee schedules and communicate the change to affected branches.
What you must do
- Update service charge rates to include applicable GST on top of ₹5 and ₹8 per packet.
- Communicate the revised charges to all non-chest branches and currency chest operators.
- Review and adjust internal accounting systems to reflect tax-inclusive billing.
- Ensure compliance with GST regulations to avoid penalties or queries.
Who it affects
All banks operating currency chests, Non-chest bank branches depositing cash at currency chests, Treasury and operations teams handling cash logistics
What are the base service charges mentioned in the circular?
The base charges are ₹5 per packet and ₹8 per packet, as per earlier circulars from January 2016 and May 2019.
Does this circular change the base service charge amounts?
No, it only clarifies that these amounts are exclusive of GST, so applicable taxes must be added.
When is this clarification effective?
The circular is dated September 6, 2022, and is effective from that date.