The Hindu : Tamil Nadu News : Banks told not to levy collection charges

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Monday, May 19, 2008
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Tamil Nadu

Tamil Nadu

Banks told not to levy collection charges

Staff Reporter

ARIYALUR: The district administration has advised officials of nationalised banks to desist from levying collection charges for government funds routed through their branches to the village panchayats for implementation of National Rural Employment Guarantee Project (NREGP).

Pointing to the guidelines that restricts banks from levying collection charges for disbursal of money under government schemes, Collector R. Sudalaikannan said that the practice of some banks to collect collection charges had caused shortage of funds for implementation of the NREGP in several of the villages.

District Rural Development Agency (DRDA) issues demand drafts taken in the name of the lead bank - State Bank of India in Ariyalur district – to the village panchayat presidents, who, in turn, deposit the same in the nearest branch of a nationalised bank.

Since the amount is directly credited into the accounts of the labourers, the village panchayat presidents face difficulties while disbursing the amount. The banks which have already levied collection charges must deposit the same in the accounts of the village panchayats concerned, the Collector said.

The scheme is under implementation since April this year in five villages in each of the six blocks in the district.

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