State Bank of India has decided to charge its customers for breaching the prescribed minimum balance of Rs 5000, but the government has asked the bank to re-consider the plan.
SBI is the biggest bank of the nation and holds arround 31 crore savings bank accounts. The bank has re-introduced this levy after a good long five years. It claimed that the five year pause was made to lure more customers.
Post demonetisation, the bank witnessed a massive growth in number of people entering the formal banking system. In December last year, just a month after demonetisation, the bank had declared that its saving accounts had swollen up by Rs 1 lakh crore.
Despite the growth, the bank is willing to add more levies for every customer.
If you're still unclear about the changes, here are the key points regarding the new minimum balance criteria that will be charged April 1 onward:
- If you're living in a metro city, chances are you might have to maintain a higher minimum balance compare to all non-metro cities. The new minimum balance has been set at Rs 5,000 for six metro cities. The rural bank accounts will have a lower minimum balance requirement.
- The penalty won't be same for every account. It will range between Rs 20-100 if you're not able to maintain the minimum average balance (MAB) in savings bank accounts
- If you hold a current account in SBI, the penalty can get as high as Rs 500
- However, minimum balance requirement won't apply to the PM's Jan-Dhan Yojana (PMJDY) accounts or to the 'Basic Savings Bank' accounts
- The penalty for breach of MAB is being reintroduced after a gap of five years.
- Not only did the bank re-introduce the penalty, it also increased it drastically when compared to the prescribed minimum amount five years back.
SBI has also imposed restrictions on withdrawals of cash from its branches as well as ATMs. These will attract charges after certain specified limits. Some private banks, like HDFC Bank, ICICI Bank and Axis Bank, have started charging a minimum amount of Rs 150 per transaction for cash deposits and withdrawals beyond four free transactions in a month.