SBI cut down minimum balance charges by up to 75%

SBI slashes monthly balance charges by 75 per cent

From April 1, SBI will reduce penalty it charges for not maintaining minimum balance

The State Bank of India closed almost 41.16 lakh savings accounts between April-January in the current fiscal year for not maintaining the average monthly balance, an RTI query revealed on Tuesday. The rates have been reduced by 75 per cent and new charges will be effective from April 1, 2018. The decision comes in view of the feedback from the various users. The charges at rural centres and semi-urban were also changed to Rs 20-40 from Rs 25-75. For Semi-Urban and Rural centres the charges have been reduced from Rs 40 per month plus GST to Rs 12 per month and Rs 10 per month plus GST respectively, a TOI report said.

Now SBI customers have even more cause to celebrate: The lender has chose to lower the penalty further, to just Rs 15, plus GST, per month for customers in the metros and urban centres.

"We have reduced these charges taking into account the feedbacks and sentiments of our customers". This 70 percent cut in the penalty amount is expected to benefit over 25 crore SBI customers.

Interestingly, while SBI provided relief to customers in regards to AMB in savings account, it also encouraged customers for shifting towards Bank Saving Bank Deposit (BSBD) account.

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Including SBI, other banks across the country also charge penalties if there are not enough funds in the account.

Shifting to BSBD account is even more convenient and flexible, because there is no charges levied by SBI on them. The minimum balance in metro and urban cities are Rs.3000. This helps customers get basic savings bank facilities without being subject to the maintenance of the AMB.

SBI has reviewed its minimum balance requirement following a finance ministry report which showed that SBI collected Rs 1,771 crore during April-November 2017 as a penalty from customers for non-maintenance of monthly average balance in savings accounts. The rate of interest is same as savings bank account.

Of that, 16 crore are under the Pradhan Mantri Jan Dhan Yojana/basic savings bank deposit (BSBD) and of pensioner, minors, social security benefit holders which are all exempted from the penalty for not maintaining of the minimum balance. This amount was more than SBI's net profit for the July-September quarter.

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