SBI Shuts 41.2 Lakh Saving Accounts For Not Keeping Minimum Balance

SBI Shuts 41.2 Lakh Saving Accounts For Not Keeping Minimum Balance

A Right to Information (RTI) plea has revealed that India's largest lender State Bank of India (SBI) closed as many as 41.16 accounts in the first 10 months of the current financial year as the owners failed to maintain the minimum required balance.

In April 2016, the SBI had re-introduced the penal charges on non-maintenance of average monthly balance after a gap of five years. The decision comes in view of the feedback from the various users. Earlier the charges were Rs 50 per month plus GST.

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. The bank has reduced the charges by up to 75% in different categories of savings account, after taking in feedback from various stakeholders. "Bank also offers its customers to shift from regular savings bank account to BSBD account on which no charges are levied", P.K. Gupta, managing director, SBI, said in a statement.

State Bank of India (SBI) has retained the amount that has to be maintained as average monthly balance. The above revision in AMB will benefit 25 crore customers.

SBI has reviewed its minimum balance requirement following a finance ministry report which showed that SBI collected Rs 1,771 crore during April-November 2017 as a penalty from customers for non-maintenance of monthly average balance in savings accounts. Let's assume he had a balance of Rs 10,000 in his savings account on February 1, but withdrew Rs 8,000 on Feb 8.

Of that, 16 crore are under the Pradhan Mantri Jan Dhan Yojana/basic savings bank deposit (BSBD) and of pensioner, minors, social security benefit holders which are all exempted from the penalty for not maintaining of the minimum balance. Also, accounts holders under the age of 21 were exempted. This was more than its September quarter profit of Rs 1,581.55 crore.

The Bank also provides the option of converting the regular savings bank account to Basic Savings Bank Account (BSBD account), free of charge.