Rationalisation of charges levied by banks on returned cheques

Abstract

This is an approach paper for rationalisation of service charges levied by banks on returned cheques in India. The analysis carried out here has an underlying premise that competitive market pricing is required to safeguard consumer interest, and if market fails to have a pricing structure which is competitive, it becomes imperative to take recourse to public policy to protect consumer interest. We look at the reasonability of service charges levied by banks on return cheques. The study concludes that there is a need to rationalize and bring in uniformity in the amount of service charges for return cheques.