SBI slashes fine for not keeping min balance

Mumbai: In a move that will benefit 25 crore account holders, State Bank of India (SBI) has reduced charges for non-maintenance of average monthly balance (AMB) in savings accounts by more than 70%. The revised charges will be effective from April 1, 2018.

The charges for non-maintenance of AMB for customers in metro and urban centres have been reduced from a maximum of Rs 50 per month plus goods and services tax (GST) to Rs 15 plus GST. For semi-urban and rural centres, the charges have been reduced from Rs 40 each month plus GST to Rs 12 and Rs 10 plus GST, respectively.

“We have reduced these charges taking into account the feedbacks and sentiments of our customers. SBI also offers its customers options to shift from regular savings bank account to basic savings account on which no charges are levied,” the bank said.

SBI had faced a lot of flak after it came to light that it earned more from minimum balance penalties than its profits (which were contained because of bad loan provisions). Also, many students and underprivileged customers lost their balances because of wrongful classification of their accounts as regular savings accounts.

SBI has 41 crore savings bank accounts, out of which 16 crore accounts are either under Pradhan Mantri Jan-Dhan Yojana or basic savings bank accounts. Both these do not have minimum balance requirements.

Additionally, pensioner/minor/social security benefit holder accounts were already exempted. Also, students up to the age of 21 years are exempted. So the latest revision in AMB will benefit 25 crore customers.“Due to provisions of penalty on non-maintenance of minimum balance, the bank has closed 41 lakh savings bank accounts between April 1, 2017 and January 31, 2018,” the bank replied to an RTI query filed by Chandra Shekhar Gaud from Neemuch in Madhya Pradesh.

State Bank of India