SBI reduces charges on non-maintenance of minimum balance by 75%

SBI reduces charges on non-maintenance of minimum balance by 75%

Both these accounts do not have minimum balance requirements. With SBI taking this step, it can be expected that other banks would follow too.

For eliminating the tension mounting over maintaining average minimum balance among Indian citizens, the largest financial service provider State Bank of India (SBI) in a major move has chose to trim down the charges levied on AMB in savings account with effect from April 01, 2018. SBI also provides its customers the option of shifting from a regular savings bank account to basic savings bank deposit account (BSBD) on which no charges are levied.

The charges for non-maintenance of AMB has been trimmed to Rs 15 per month plus GST from the earlier Rs 50 per month plus GST in metro and urban areas, as per a release by SBI.

Last April, the nation's largest lender had re-introduced the penal charges on non-maintenance of average monthly balance, after a gap of five years. Take for instance an account in a metro city in a 31-day month. For urban and metro customers average monthly balance is of Rs 3,000 per month. So, no penalty would be imposed in this case.

SBI reestablished (AMB) charges from April 2017, following a hole of 6 years and afterward amended it downwards in October after input from partners. If the shortfall is between 50% and 75% of the AMB needed, the charge would be Rs40 and if the shortfall is over 75%, it is Rs50. Along with this, the limit was made to Rs 2000 for the customers of semi-urban branches.

Though the penalty has been reduced, you should remember that the amount of AMB required would remain the same.

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. At Present SBI has 41 crore savings bank accounts, out of which 16 crore accounts under the Pradhan Mantri Jan Dhan Yojna, BSBD, and of pensioners/minors/social security benefit holders are already exempted from charges on non- maintenance of minimum balance.

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