SBI retains minimum balance limit but cuts penalty charges by 75%

SBI retains minimum balance limit but cuts penalty charges by 75%

Mumbai: State Bank of India (SBI) on Tuesday announced up to 75% reduction in charges levied on savings bank account customers for not maintaining the average monthly balance (AMB).

The revised charges would be effective from April 1, 2018. The decision comes in view of the feedback from the various users.

For customers in metro and urban areas, applicable charges for not maintaining Rs3,000, which is the AMB, have been brought down to Rs10-15 from Rs30-50 now. SBI has 41 crore savings bank accounts out of which 16 crore accounts are either under Pradhan Mantri Jan Dhan Yojana or are basic savings bank accounts.

Between April 2017 and November 2017, SBI had collected Rs1,771.67 crore from customers on account of non-maintenance of AMB, according to a response that the Ministry of Finance gave in Lok Sabha in February 2018 (read it here).

"When an SBI customer uses a debit card at some other bank ATM, then SBI has to pay Rs 17 to the bank". The public sector lender faced widespread flak for its minimum account balance charges, which were seen as hitting mostly financially weaker account holders. The charges at rural centres and semi-urban were also changed to Rs 20-40 from Rs 25-75.

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In April 2017, SBI had re-introduced the requirement for maintaining AMB and imposed penalties for non-maintenance after six years. This penalty was conveyed down to Rs 30-50.

The above revision will benefit 25 crore bank customers.

The features of BSBD accounts are available on the bank's website Besides pensioner/minors/social security benefit holders accounts were already exempted.

Additionally, students up to the age of 21 years are also exempted. The bank also clarified that customer always has the option of converting the regular savings bank account to Basic Savings Bank Account (BSBD account), free of charge, in case he desires to avail basic savings bank facilities without being subject to maintenance of AMB. My outgo on the ATM card itself is Rs 1,500 crore annually.

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