The State Bank of India has said it will start charging its account holders a penalty if they fail to maintain a minimum balance in their savings account. According to the new rules effective from April 1, it is mandatory for accounts to maintain a balance of Rs 5,000 in metropolitan areas, Rs 3,000 in urban areas, Rs 2,000 in semi-urban areas and Rs 1,000 in rural areas, reported IANS.
SBI had done away with the minimum balance rule in 2012. The bank will use this penalty amount to cover expenses such as running operations and systems for its 250 million savings accounts, an SBI executive told the Business Standard.
For metro areas, if the difference between the minimum balance and the actual amount is 50%, then SBI will charge Rs 50 plus service tax as a penalty. If the difference is anywhere between 50% and 70%, the penalty will be Rs 75 plus service tax. If the shortfall is more than 75%, the charges will be Rs 100 excluding the service tax.
For urban areas, charges will be anywhere between Rs 40 and Rs 80, excluding service tax. In semi-urban areas, the penalty will be between Rs 25 and Rs 75 plus service tax. In rural areas, the charges are between Rs 20 and Rs 50, inclusive of service tax.
The bank will continue to charge the account holders Rs 50 for carrying out more than three cash transactions in a month. Moreover, SBI will also charge a penalty for NEFT/RTGS transactions, issuing cheque books, stop payments, among others charges, reported The Indian Express. Annual maintenance for debit cards will be anywhere between Rs 125 and 300 and the number of free ATM transactions will be three in metros and five at other centres, the report added.
On March 1, HDFC Bank, ICICI Bank and Axis Bank hiked cash transaction fees and limited free cash deposits and withdrawals to four for a month.