SBI Crackdown on Saving Accounts: 41.2 Lakh Accounts Closed For Not Maintaining Minimum Balance
Between April and November 2017, the SBI had netted a windfall of Rs 1,771.67 crore, more than its second-quarter profit, from customers for non-maintenance of minimum balance, according to the finance ministry data.
New Delhi, March 14: In a major blow to saving account holders, India’s largest lender – the State Bank of India (SBI) has closed as many as 41.16 lakh accounts between April-January in the current fiscal year. According to a recent RTI query, the latest move by SBI comes after saving account holders failed to maintain the average monthly balance in their accounts.
"Due to provisions of penalty on non-maintenance of minimum balance, the bank has closed 41.16 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. Reports state that reply was given to a specific query on the number of accounts being closed after introduction of charges on non- maintenance of minimum balance from April 1, 2017.
It must be noted that between April and November 2017, the SBI had netted a windfall of Rs 1,771.67 crore, more than its second-quarter profit, from customers for non-maintenance of minimum balance, according to the finance ministry data.
The move comes amid reports that SBI is reducing the maintenance of monthly average balance (MAB) charges to Rs 15 per month. In April 2017, SBI had re-introduced the penal charges on non-maintenance of average monthly balance after a gap of five years. Later in October, it had revised down the charges to some extent. Even though the reply was furnished by the state-run lender on February 28, 2018, the bank today steeply reduced the penal charges on not maintaining the minimum balance.
The SBI on Wednesday reduced the penalty charges on non-maintenance of average monthly balance by up to 75 per cent from April 1 as the measure had faced a public backlash for raking in huge profits by way of penal charges. However, the bank has not lowered the monthly minimum balance requirement which has been retained at Rs 3,000 for metro customers, at Rs 2,000 for semi-urban accounts and at Rs 1,000 for rural accounts.
SBI has decided to substantially reduce charges for non-maintenance of average minimum balance in a savings account. As per reports, the charges for non-maintenance of average minimum balance (AMB) for customers in metro and urban centres have been reduced from a maximum of Rs 50 per month plus GST to Rs 15 per month plus GST.
To recall, the SBI has about 41 crore savings bank accounts across the nation. Reports by PTI inform that of the 41 crore accounts, 16 crore are under the Pradhan Mantri Jan Dhan Yojana/basic savings bank deposit (BSBD) and of the pensioner, minors, social security benefit holders which are all exempted from the penalty for not maintaining of the minimum balance.
(The above story first appeared on LatestLY on Mar 14, 2018 05:08 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).