Come April 1, SBI all set to impose penalty for not maintaining minimum account balance

Come April 1, SBI all set to impose penalty for not maintaining minimum account balance

State Bank of India, India’s largest bank, has decided to resume the charge on savings account holders for failing to maintain the monthly average balance in their accounts. The bank had, according to a PTI report, done away with the minimum balance criteria for savings bank accounts a few years back in a bid to lure new customers. Sources said the service charges for non-maintenance of monthly average balance (MAB) will be revised with effect from April 1, 2017.

According to information available on the SBI website, the monthly average balance that customers will have to maintain in their savings bank accounts in SBI branches in metropolitan areas is Rs 5,000. In case the shortfall in the monthly average balance is below 50 per cent, then a charge of Rs 50 plus service tax will be levied. If the shortfall is between 50 and 75 per cent, then the account holder will have to pay Rs 75 plus service tax, and if the shortfall in the average balance is more than 75 per cent, then a charge of Rs 100 plus service tax will be levied.

 Similarly, in urban areas SBI customers will be required to maintain a monthly average balance of Rs 3000. If the shortfall in MAB is less than 50 per cent, then a charge of Rs 40 plus service tax will be levied. If the shortfall is between 50 and 75 per cent, then the account holder will have to pay Rs 60 plus service tax, and if the shortfall in the average balance is more than 75 per cent, then a charge of Rs 80 plus service tax will be levied.     

 In semi-urban areas, customers will have to maintain a monthly average balance of Rs 2000, while in rural areas, maintaining an MAB of Rs 1000 will be a must, failing which charges will be levied as per the applicable rates in those areas. Meanwhile SBI has reduced interest rates on term deposits maturing between 180 days and one year, and between 456 days and three years with effect from March 1.     

 The country’s largest bank by assets will now pay 6.5% on deposits with maturities between 180 days and less than one year, and 6.75% on those maturing between 456 days and less than three years. Earlier, SBI used to pay 6.75% on deposits maturing between 180 days and 210 days, 7% on those maturing between 211 days and less than a year, 6.95% on deposits maturing between 456 days and under two years, and 6.85% on those maturing between two years and less than three years.