SBI reduces charges for non-maintenance of AMB

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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.

State Bank of India, SBI has cut down the charges for non-maintenance of average minimum balance in its savings accounts by up to 75 per cent. "SBI also offers its customers options to shift from regular savings bank account to basic savings account on which no charges are levied". The charges for non-maintenance of AMB for customers in metro and urban centres have been reduced from Rs 50 to Rs 15 a month.

In semi-urban and rural centres the charges have been trimmed from Rs 40 per month plus GST to Rs 12 and Rs 10 per month plus GST, respectively.

After a revision a year ago, customers from urban centres are required to maintain a balance of Rs 3,000, while it is Rs 2,000 and Rs 1,000 for semi-urban and rural centres respectively. The move had invited widespread criticism. The charges at semi-urban and rural centres were also revised to Rs 20-40 from Rs 25-75, said an Economic Times report.

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As The Wire has reported, during April-November 2017, SBI collected Rs 1,771 crore in penal charges from its customers, which was more than its net profit of Rs 1,581.55 crore for the same period. On the other hand, if we talk about rural areas, you have to maintain a balance of 1000 rupees in your account as a minimum balance. SBI has announced that it will benefit over 25 crore customers.

While levying of charges by public sector banks, for not maintaining minimum balances, has been in the news; it is still very low in comparison to that imposed by private sector banks. The bank rejects Jan Dhan accounts, essential funds bank stores (BSBD) accounts, retired people, recipients of social advantages from the legislature and records of minors from the MAB necessity.

He said there are more than 14 crore BSBD accounts, where the bank don't charge anything and the It also handles 40 percent of the financial inclusion accounts.

However, it needs to be noted that, the customer can not have any other Savings Bank Account, if he/she has a BSBD Account.