Banks to go harsh on customers; soon to implement GST even on the free services provided

If you are utilising the free benefits given by the Indian banks then soon this may turn upside down and the banks would start charging on services that include issuance of cheque books, additional credit cards, usage of ATMs, and refund of fuel surcharge.

The public lenders as well as the private banks like State Bank of India, ICICI Bank, HDFC Bank, and many other would reportedly start levying GST on services the customers are currently using for free.

The banks would be compelled to take this decision after the several notices issued by the Income Tax Department to banks asking them to start paying the government GST on services they provided free of cost to customers who maintain a minimum balance in their accounts.

Besides, the notices have also been sent to multinational banks like DBS and Citibank. "Most banks are now considering passing on the GST cost to the customer. This would be a pure pass-through and the amount would go directly to the government," VG Kannan, CEO of the Indian Banks' Association, told Economic Times.

The charges would vary from bank-to-bank as it would depend on how the free services being provided are valued.