SBI new rules for Minimum Balances take effect from April 1, 2018

Ellipse RathBankingLeave a Comment

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The new minimum balance rules of State Bank of India(SBI), the country’s largest commercial bank, has come into effect from April 1, 2018. SBI had reduced its penalty charges for non-compliance of average minimum balance in savings accounts by 75% last month. The move came after SBI faced criticism for earning Rs. 1,771.67 crore, more than its second quarter profit, from customers for non-maintenance of monthly average balance in savings accounts in eight months of 2017-18.

The penalty for insufficient Minimum Account Balance varies with the type of branch and the degree of shortfall.The following changes are applicable, as per SBI’s pess release of March 13, 018.

When Shortfall > 75%:

  • In metro and urban branches, the penalty has been reduced from INR 50 to INR 15, excluding GST.
  • In semi-urban and rural areas, the penalty has been reduced from INR 40 to INR 12, excluding GST.

When Shortfall is between 50 %-75%:

  • In metro and urban branches, the penalty has been reduced from INR 40 to INR 12, excluding GST.
  • In semi-urban areas, the penalty has been reduced from INR 30 to INR 10, excluding GST.
  • In rural areas, the penalty has been reduced from INR 30 to INR 7.50, excluding GST.

When Shortfall < 50%:

  • In metro and urban branches, the penalty has been reduced from INR 30 to INR 10, excluding GST.
  • In semi-urban areas, the penalty has been reduced from INR 20 to INR 7.50, excluding GST.
  • In rural areas, the penalty has been reduced from INR 20 to INR 5, excluding GST.

In urban areas, SBI customers are required to maintain INR 3000 in their savings accounts as monthly balance.  SBI customers in rural areas need to maintain INR 2000 in their savings account,.According to the bank, they have introduced changes taking into consideration the feedback of their customers. This move would benefit the 25 crore customers of SBI.

Currently, there are 41 crores Savings Bank accounts in SBI out of which 16 crore accounts under PMJDY / BSBD and of pensioner/minors/social security benefit holders were already exempted.Students up to 21 years are also exempted from the maintenance of minimum balance. Although this new move of SBI might affect the on-going provisioning for bad loans, the new guidelines are customer friendly and is appreciated by everyone alike.
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